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BP plc (GB:BP.A)
LSE:BP.A
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BP plc
(LSE:BP.A)
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Rating:73Outperform
Price Target:
168.00p
▲(11.26% Upside)
BP plc's overall stock score reflects strong financial recovery and operational performance, supported by positive technical indicators. The attractive dividend yield adds value, although challenges in profitability and leverage remain. The earnings call provided a positive outlook, despite some uncertainties.
Positive Factors
Operational Excellence
High plant reliability and increased production indicate strong operational efficiency, which supports sustainable revenue growth and profitability.
Exploration Success
New discoveries, especially in Brazil, enhance BP's resource base, ensuring long-term supply and potential revenue from new reserves.
Cash Flow Generation
Strong cash flow growth enhances BP's ability to invest in new projects and return capital to shareholders, supporting long-term financial health.
Negative Factors
Rising Leverage
Increased leverage can strain financial flexibility and increase risk, potentially impacting BP's ability to fund future growth sustainably.
Low Net Profit Margin
Persistently low net profit margins indicate inefficiencies in cost management, which could hinder long-term profitability and competitiveness.
Trading Segment Challenges
Weak performance in trading could affect overall earnings stability, highlighting potential volatility in BP's revenue streams.
BP plc (BP.A) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£68.88B
Dividend Yield5.28%
Average Volume (3M)4.62K
Price to Earnings (P/E)―
Beta (1Y)-0.04
Revenue GrowthN/A
EPS GrowthN/A
CountryUK
Employees100,500
SectorEnergy
Sector Strength52
IndustryOil & Gas Integrated
Share Statistics
EPS (TTM)N/A
Shares Outstanding7,232,838
10 Day Avg. Volume4,635
30 Day Avg. Volume4,620
Financial Highlights & Ratios
PEG Ratio-2.16
Price to Book (P/B)1.36
Price to Sales (P/S)0.43
P/FCF Ratio6.71
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
BP plc Business Overview & Revenue Model
Company DescriptionBP plc (British Petroleum) is a multinational oil and gas company headquartered in London, England. It operates in all areas of the oil and gas industry, including exploration, extraction, refining, distribution, and marketing. BP is also increasingly investing in renewable energy technologies and aims to transition towards a more sustainable energy future. Core products include crude oil, natural gas, and refined petroleum products, alongside a growing portfolio in renewable energy solutions such as wind and solar power.
How the Company Makes MoneyBP generates revenue primarily through the exploration and production of oil and natural gas, which involves extracting these resources from various locations worldwide. The company sells crude oil and natural gas to various customers, including refiners and other energy companies. Additionally, BP earns money from the refining process, where crude oil is transformed into various petroleum products, such as gasoline, diesel, and jet fuel, which are then marketed and sold through its extensive network of retail service stations and other distribution channels. Key revenue streams also come from its integrated gas business, which manages the liquefied natural gas (LNG) supply chain and sells natural gas in global markets. BP's strategic partnerships, joint ventures, and collaborations with other energy companies and governments further bolster its revenue generation capabilities, especially in new energy technology sectors. The company's ongoing transition towards renewable energy sources also positions it to capitalize on emerging markets for sustainable energy solutions, contributing to its long-term growth and revenue diversification.
BP plc Earnings Call Summary
Earnings Call Date:Nov 04, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 10, 2026
Earnings Call Sentiment Positive
BP's Q3 2025 earnings call highlighted strong financial and operational performance, with significant exploration successes and progress in divestments. However, challenges were noted in the trading segment, and uncertainties remain regarding arbitration outcomes and future exploration costs.Q3-2025 Updates
Positive Updates
Strong Financial Performance
BP reported underlying pretax earnings of $5.3 billion and underlying net income of $2.2 billion for Q3 2025. Operating cash flow for the quarter was $7.8 billion, supporting a 20% CAGR growth target for adjusted free cash flow from 2025 to 2027.
Operational Excellence
Upstream production increased by approximately 3% quarter-on-quarter, with upstream plant reliability at 97%. Refining availability was also close to 97%, marking the best quarter in 20 years for the current portfolio.
Exploration Success
BP achieved 12 exploration discoveries in 2025, including significant findings in Brazil and Namibia. The Bumerangue discovery in Brazil is highlighted as the largest in 25 years.
Cost and Efficiency Improvements
Structural cost reductions have been achieved across various business units, including approximately $0.5 billion in the customer segment and $200 million in refining.
Progress in Divestment and Strategic Reviews
BP upgraded proceeds guidance, expecting around $5 billion from divestments. The company is progressing with strategic reviews of assets like Castrol, Gelsenkirchen, and Lightsource.
Negative Updates
Challenges in Trading Segment
The trading segment experienced a weaker performance in Q3 compared to previous quarters.
Venture Global Arbitration
There is ongoing arbitration related to Venture Global, with BP seeking damages. The resolution and financial implications remain uncertain.
Potential Headwinds in Exploration Costs
Concerns were raised about whether exploration costs, particularly related to Bumerangue appraisal, would increase and impact BP's overall budget.
Company Guidance
During BP's Third Quarter 2025 Results Call, the company reported substantial metrics, showcasing strong operational performance and strategic progress. The quarter saw underlying pretax earnings of $5.3 billion and underlying net income of $2.2 billion, with operating cash flow reaching $7.8 billion. Upstream production increased by around 3% quarter-on-quarter, supported by plant reliability at 97%, marking the best quarter in 20 years for the current portfolio. Full-year underlying production guidance was upgraded, with refining availability also near 97%. BP initiated six new major oil and gas projects in 2025, with four starting ahead of schedule, and made twelve exploration discoveries, including the promising Bumerangue in Brazil. Compared to the same period in 2024, underlying earnings for the first nine months were approximately 40% higher, and the company delivered its highest third-quarter results in the customer segment. BP is advancing towards its $20 billion divestment proceeds target, with updated guidance expecting around $5 billion in completed and announced proceeds for the year. The firm remains disciplined with organic CapEx, projected to stay below $14 billion, and is focused on reducing costs, growing cash flow, and strengthening the balance sheet to enhance shareholder value and returns.BP plc Financial Statement Overview
Summary
BP plc shows a strong recovery with significant revenue growth and improved operational margins. However, challenges remain with low net profit margins and increased leverage. Cash flow generation is improving, but maintaining this trend is crucial for financial stability.Income Statement
BP plc has shown a strong recovery in its revenue growth with a 61% increase in TTM, following a decline in previous years. The gross profit margin improved slightly to 16.17% in TTM, indicating better cost management. However, the net profit margin remains low at 0.33%, suggesting challenges in converting revenue into profit. The EBIT and EBITDA margins have improved, reflecting operational efficiency gains.75
Positive
Balance Sheet
The debt-to-equity ratio has increased to 1.27 in TTM, indicating higher leverage, which could pose a risk if not managed carefully. Return on equity is low at 1.07%, suggesting limited profitability from shareholders' equity. The equity ratio is stable, showing a balanced asset structure.68
Positive
Cash Flow
Free cash flow has grown by 24.23% in TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is 0.28, suggesting moderate efficiency in converting income into cash. The free cash flow to net income ratio is 0.37, reflecting a reasonable cash flow position relative to net income.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 186.58B | 185.23B | 213.67B | 240.86B | 154.71B | 112.38B |
| Gross Profit | 36.20B | 28.11B | 47.39B | 54.05B | 21.65B | -534.61M |
| EBITDA | 31.08B | 25.11B | 42.89B | 29.37B | 27.82B | -7.46B |
| Net Income | 1.56B | 382.83M | 15.50B | -2.48B | 7.42B | -21.54B |
Balance Sheet | ||||||
| Total Assets | 280.46B | 282.23B | 280.29B | 288.12B | 287.27B | 267.65B |
| Cash, Cash Equivalents and Short-Term Investments | 35.05B | 34.52B | 28.59B | 29.77B | 30.96B | 29.53B |
| Total Debt | 74.82B | 71.55B | 63.08B | 55.49B | 69.79B | 81.93B |
| Total Liabilities | 202.81B | 203.91B | 194.80B | 205.13B | 196.83B | 182.09B |
| Stockholders Equity | 58.24B | 59.25B | 70.28B | 67.55B | 75.46B | 71.25B |
Cash Flow | ||||||
| Free Cash Flow | 10.67B | 12.00B | 17.75B | 28.86B | 12.72B | -144.00M |
| Operating Cash Flow | 24.30B | 27.30B | 32.04B | 40.93B | 23.61B | 12.16B |
| Investing Cash Flow | -11.24B | -13.25B | -14.87B | -13.71B | -5.69B | -7.86B |
| Financing Cash Flow | -12.51B | -7.30B | -13.36B | -28.02B | -18.08B | 3.96B |
BP plc Technical Analysis
Positive
151.00
Price Trends
150.20
Positive
149.30
Positive
145.53
Positive
Market Momentum
0.20
Positive
57.61
Neutral
60.00
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:BP.A, the sentiment is Positive. The current price of 151 is below the 20-day moving average (MA) of 151.05, above the 50-day MA of 150.20, and above the 200-day MA of 145.53, indicating a neutral trend. The MACD of 0.20 indicates Positive momentum. The RSI at 57.61 is Neutral, neither overbought nor oversold. The STOCH value of 60.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:BP.A.
BP plc Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | £1.77B | 10.89 | 17.24% | 4.74% | -2.66% | 0.11% | |
74 Outperform | £163.26B | 15.13 | 8.25% | 3.87% | -9.21% | -2.61% | |
73 Outperform | £68.88B | ― | ― | 5.28% | ― | ― | |
67 Neutral | £1.75B | 10.79 | 12.03% | 5.92% | 159.13% | 143.76% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
63 Neutral | £3.79B | -10.03 | -11.32% | 8.29% | 123.03% | -330.89% | |
55 Neutral | £3.67B | -29.56 | -4.67% | 13.01% | 63.10% | -161.03% |
* Energy Sector Average
GB:BP.A
BP plc
151.00
18.99
14.39%
GB:HBR
Harbour Energy
210.20
-25.50
-10.82%
GB:SHEL
Shell (UK)
2,800.50
345.43
14.07%
GB:SEPL
SEPLAT Petroleum Development
247.00
49.80
25.25%
GB:ENOG
Energean
957.50
15.78
1.68%
GB:ITH
Ithaca Energy PLC
176.40
82.45
87.76%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.