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BP Beefs Up Stake in Lightsource BP, Clean Energy in View

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BP plc (BP - Free Report) announced its decision to raise its stake in Lightsource BP. With a 7% additional stake, the British integrated energy giant has boosted its ownership interest in the European solar developer to 50% from the prior 43%.

Notably, Lightsource was rebranded to Lightsource BP after BP had taken over a 43% stake in December 2017. Thus, with the purchase of the business’ newly-issued equity, BP has become a joint venture partner. However, no financial details relating to the transaction have been provided by either company.

The recent move reflects BP’s intention of boosting capital spending on renewable power business as most oil companies in Europe have decided to combat climate change by reducing greenhouse gas and carbon emissions and focusing on clean energy.

BP added that although renewable power business generates relatively lower returns than oil and natural gas operations, alternative energy is not exposed to the volatility in commodity prices. In fact, companies can generate stable returns from renewable power, BP revealed.

Investors should know that the companies have simplified their joint venture structure with the latest agreement. The transaction also unveils Lightsource BP’s plan to develop 10 gigawatts of assets by 2023-end.

Headquartered in London, BP is a leading integrated energy player. Currently, the stock carries a Zacks Rank #3 (Hold). Meanwhile, a few better-ranked players in the energy space are Murphy USA Inc (MUSA - Free Report) , Sasol Limited (SSL - Free Report) and CNX Resources Corporation (CNX - Free Report) . While Murphy USA and Sasol sport a Zacks Rank #1 (Strong Buy), CNX Resources carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Murphy USA beat the Zacks Consensus Estimate in three of the prior four quarters.

For fiscal 2020, Sasol is likely to post earnings growth of 30%.

CNX Resources surpassed the Zacks Consensus Estimate in two of the prior four quarters. It has a positive earnings surprise of 34.8%, on average, for the trailing four quarters.

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