The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
I keep racking my brains is the market pricing something in I've missed. We are some margin behingld the share price recovery curve vs most major indicators: peers, Dow, Ftse and oil/gas price
Oil price forecast is $80 by goldman sachs and demand hasn't fully got going yet. Interest rates remain low. QE almost certain to continue and exchange rate good. Bp have a strategy ahead of peers to diversify energy base
The only things I can think of are sentiment and delta variant but these apply to our peers and oil price as well, yet they are far stronger than our SP.
The price targets from here are higher, alot higher from some major banks.
Its one to sit out as value will come despite this frustrating period
Are we missing something.
No trading update this quarter. BP's peers all doing good. A few days before the results,when those in the know already know the results and down around 2%. Against any other normality this is starting to smell.
I expected a bit more than a childish response thankyou
Licker
A little bit uncalled for and unnecessary, you're better than that, usually.
Try not to let your frustration with your lack of comprehension as to why BP's share price is so low compared to it's peers with all the indicators YOU mention.
You post that you are racking your brains and can not understand what the reason is why the share price is where it is. So you have worked out there must be a reason for it but you have no idea why. Maybe delta or sentiment but you have also worked out that these apply to BP's peers as well, who are not seeing the downward pressure on their share prices.
So, let's wait and see what next week brings before you rubbish as childish a genuine possibility as to there being another possible, if not probable, answer to your thought provoking question, Are we missing something.
MarkGo
Fair point appologise
Licker
We are on the same team. Your hopes for the share price are totally aligned with mine. I am a long term holder of BP, in the 'hope' that the next 12 months plus will see an end to the uncertainty and turbulence and that we all make a lot of money out of being invested in BP and while we wait a loyalty payment via the dividend will be maintained and possibly, if not probably increased. ( a seperate debate I know )
I see from your posts that you have substantial funds invested in BP, as do I.
I also see that you believe market analysts and market movers are aware, in the main, of the upcoming results prior to announcement, so do I and you scratch your head as to the reason of BP's position, again, so do I.
Nothing would give me greater satisfaction if the results, next week, results in a lift in confidence and share price and commences a rally on the share price over coming months but I sense that something may not be right, as you post, are we missing something?
Have a great day.
MarkGo
Indeed we are I was a bit curt inapplogise. All I can see on downside are redundancy payments GOM but that's an very well known matter.
It's mystifying really. One possible is a very large seller in the background like a sovereign wealth fund? Has anyone been watching trades and volumes here? I haven't.
Hey licker
Absolutely no need to apologise mate.
Have a fantastic day.
It could simply be that the market has rebased BP value based on (i) a stated 40% reduction in output over the next 8 years, and (ii) a lack of clarity around future costs, revenue and profit from the transition to renewables.
In other words this aint seeing £3 plus for a peroid of time. I t will pick up back end of year/early next. BUY at 255-265 levels and hold.............
denman you thought the bottom was more likely 285/290 2 weeks ago, whats changed?
Just overall market feel and my own...... this will test 280 again for sure next week. There is no momentum here. Markets are due a correction, inflation, no momentum etc blah blah- these factors will pull this down along with large Institutions pulling this down. This is not a buy right now for sure IMO.
Anyone that says something will happen in markets "for sure" doesn't have a clue lets be honest. Markets are highly random and irrational, especially in the short term. Bp lags its peers thats for sure and the market seems to not appreciate the uncertainty in the pivot to renewables. This could lag for a while, but to say it 100% couldn't be over 300 soon especially with earnings next week and oil where it has been is ridiculous. :) Also xom and chevron both just beat, and are trading up pre market so bodes well for bp especially with rds yesterday aswell.
Zac0_4
That's a possibility. The much discussed and hoped for re-rating may have happened. This SP could be fair value, the new normal. Comparisons with pre covid valuations meaningless.
Maybe a re-rated valuation based on risk. Risk of transition cost and ROI. Risk of return on investment of the multi-billions being invested. Will they all pay off.? Will BP massively overpay for the promise of returns that can only be estimated, best case scenario , desk top calculations.
Risk of future western government policy, COP26 in November and the risk of the climate pressure lobby on legislation.
Risk, or more of a certainty, that the price of oil will not remain at these high levels for more than a few years. If Opec+ restrictions are ended, as planned, at the end of 2022, we may see a free-for-all and a big drop in the poo and the resulting lack of revenue to continue investing in BP's long game of transition. Where would that leave BP's long term business plan ?
These are risks and there are probably many more.
Only time will tell if any of them were valid concerns.
If all this is true then why have BP been hammered far more than all other majors for these macro sector factors
licker - stating that you are reducing output by 40% over the next 8 years is not a macro economic event. How many other oil companies have put a number to reduced output over a given timescale?
licker
I have no idea like the rest. Seeing BP back in the 280's is unexplainable. The only ones who know are the ones who are controlling the SP. Maybe lack of liquidity is enabling market makers to manipulate the price.
Other industry commentators state this as a positive market reflecting switch off fossil to renewable whilst many peers doing better than BP have fall off edge of cliff strategies.
Exxon are due to report their Q2 results in 10 mins. It will be interesting to see how the market reacts. The numbers should be great.
In normal times I would expect this would give BP a lift.
Exxon massively beat analysts expectations. Profits super surge and yet.....you guessed it. The SP down.
I hope that this isn't a pre warning for what is to come on Tuesday.
What BP have in terms of advantage is a MASSIVE trading arm .... if that doesn't make them serious cash during this rising market nothing will.
Yes, very strange day with O&G majors today....
aimo
Markets disappointed at no increase in divi or share buyback by Exxon maybe? Instead paying off debt..
I own Exxon and I'm a bit disappointed that there was no dividend increase or buyback. They will focus on debt reduction for now having not cut the dividend in 2020.
Excellent operational performance. I'm listening to the webcast now. Really talking up the record quarterly result from their chemicals business. They reckon by 2027, the chemicals earnings contribution will increase by 100% from today! Why, oh why, did Looney flog ours for just $5bn to Ineos?
Best
Happy
weekly/monthly option day today - MMs may want to keep this below $24 today to make the calls worthless, enjoy the dip ! it will be up for ex div by 7.5%/10%!