BP (BP, Financial) is currently engaged in preliminary discussions with Shell regarding a potential acquisition, as reported by individuals close to the situation. These ongoing talks are being taken seriously by BP as they evaluate Shell's proposal. With BP's current market valuation near $80 billion, the deal could potentially be historic, possibly surpassing the monumental $83 billion merger that formed Exxon Mobil.
Following the news, BP's stock experienced a significant increase, climbing $2.84 or 9.5%, reaching $32.67 in New York trading. This development has drawn considerable attention, potentially setting the stage for one of the most substantial deals in the oil sector's recent history.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 15 analysts, the average target price for BP PLC (BP, Financial) is $33.71 with a high estimate of $49.00 and a low estimate of $26.50. The average target implies an upside of 3.85% from the current price of $32.46. More detailed estimate data can be found on the BP PLC (BP) Forecast page.
Based on the consensus recommendation from 18 brokerage firms, BP PLC's (BP, Financial) average brokerage recommendation is currently 2.7, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for BP PLC (BP, Financial) in one year is $33.75, suggesting a upside of 3.97% from the current price of $32.46. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the BP PLC (BP) Summary page.
BP Key Business Developments
Release Date: April 29, 2025
- Refining Availability: Over 96% in 1Q 2025.
- Upstream Plant Reliability: More than 95% in 1Q 2025.
- New Project Capacity: Added 100 mbd towards a target of 250 mbd by 2027.
- Exploration Discoveries: Six discoveries, including significant find in Namibia.
- Customers Business Performance: Best first quarter since 2020 on an underlying RCOP basis.
- CapEx Reduction: Reduced by $0.5 billion to $14.5 billion for 2025.
- Organic CapEx: Below $14 billion for 2025, excluding inorganic payments.
- Divestments: $1.5 billion completed or signed, expecting $3 billion to $4 billion in 2025.
- Operating Expenditure: Down $500 million quarter on quarter.
- Net Debt: Rose due to working capital build, expected to unwind through the year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- BP PLC (BP, Financial) achieved strong operational performance with over 96% refining availability and more than 95% upstream plant reliability.
- The company successfully started up three major projects, adding 100 mbd of capacity towards its target of 250 mbd by 2027.
- BP PLC (BP) made six exploration discoveries, including a significant find in Namibia.
- The Customers business delivered its best first quarter since 2020 on an underlying RCOP basis.
- BP PLC (BP) reduced CapEx by $0.5 billion for 2025 and expects $3 billion to $4 billion in divestments, with proceeds weighted to the second half of the year.
Negative Points
- Gas & Low Carbon segment missed earnings expectations due to a weak gas trading result.
- Net debt rose in the quarter, primarily due to a working capital build.
- The refining business faced challenges with difficult margin environments in the Midwest and Rotterdam.
- The share count increased despite a $1.75 billion buyback, partly due to employee share plans.
- The effective tax rate for the first quarter was around 50%, higher than previous quarters, impacting overall profitability.
