Bp plc_ a play on higher oil prices with an attractive 7% dividend yield – bp p. l.c. (nyse_bp) _ seeking alpha

The table above shows the summary financials and valuation for BP. Nyc electricity consumption Note the immense expense related to the Macondo, which since 2010 has totaled $55BN including cleanup, litigation, and various compensation schemes for the victims of the oil spill.

Now that this tragic episode is largely behind BP, the company should report improved financial performance. Gas engineer salary Expect potential higher dividends or share buybacks if the oil price continues to stay strong and Macondo expenses continue to trend towards zero.

In terms of the financials, we can see that in its heyday BP generated adjusted EBITDA of nearly $40BN annually on sales above $300BN. Electricity billy elliot The current reduced sales and EBITDA are largely due to the lower prices which have fallen nearly 50% since 2013. Gas number density Year to date, oil prices have improved advancing nearly 100% from the lows of $26 per barrel to the current price of around $50.

I have valued BP using sales between $203BN (LTM), $225BN and $250BN. E payment electricity bill bangalore Gross margins have been estimated using historical ranges between 28% and 32%. Electricity worksheets high school Total overhead excluding expenses related to Macondo are currently around $38BN generating adjusted EBITDA of $18BN to $41BN. Wd gaster theory Using EBITDA multiples of 7x, 8x and 9x, this implies an equity value per share (including Rosneft) of between $28 and $99.

At first glance these assumptions may seem aggressive but essentially it’s assuming that BP can again achieve the profitability that it generated pre-2010. Gas 93 Obviously this assumes oil prices will recover to historical highs above $100 per barrel.

A fundamental and technical analysis of a commodity related company would not be complete without some discussion of the expected price of the commodity itself. Gas variables pogil key There are those that believe one can predict commodity prices using fundamental analysis, by forecasting supply and demand.

I do not agree for two reasons: First, the amount of data points one must include in such an analysis for it to be complete is immense and probably beyond the scope of even the most resourceful investor.

Second, it completely ignores the speculative aspect which for most commodities is significant. Gasco abu dhabi Not only are pure speculative investors involved in most commodity markets but trade buyers and sellers tend to speculate as well by timing their sales and purchases according to their view on price. Arkansas gas prices Thus a buyer of copper may stockpile copper for future use if he thinks prices will rise and postpone purchases if he thinks prices will fall. Gas 10 ethanol As a result, the price expectations of a commodity greatly influences current price which is one of the main tenets of technical analysis, i.e. 1 unit electricity cost in kerala prices today impact future prices.

This is a classic 3 wave correction which in Elliot wave terms is known as a zig zag. Electricity transmission In this case, the recovery consisted of a triangle. Electricity grid code Wave C can be subdivided into 5 waves suggesting that a bottom could have already have been found in February of 2016. Electricity magnetism and electromagnetism This is confirmed by a diverging RSI.

Note the long term implications of the chart below. Gas works park address If correct, then it would imply that a new bull market has already resumed which in the coming years ahead will propel oil prices to above historical highs of $140 per barrel. Electricity vancouver wa This will definitely take several years and most likely caused primarily by a lower USD (Long term oil is inversely correlated to the USD).

Oil has likely ended its 8-year bear market that started in 2008 with lows around $32 and $26 per barrel. Extra strength gas x while pregnant The BP share price similarly has most likely found a long term bottom ending a multi-year downtrend caused first by the Macondo oil spill and then more recently by a sharp fall in oil prices during 2015 and 2016.

At this point, I believe (1) oil prices will continue rising resulting in higher profits at BP and (2) the Macondo related expenses will continue falling allowing greater shareholder returns to be achieved in the future.

The technical outlook is favorable. 9game Note BP with an enterprise value of $89BN will not provide the highest returns in the oil sector simply because of its size.

However, I do believe that BP should return 10-15% annually between dividends, share buybacks and minimal capital appreciation making BP an attractive oil related investment for risk averse investors. J gastrointest oncol impact factor Should oil prices increase to above $100 per barrel in a relative short time frame then total returns could be higher.

I wrote this article myself, and it expresses my own opinions. Electricity and magnetism lecture notes I am not receiving compensation for it (other than from Seeking Alpha). Electricity labs high school I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: This article presents the opinions of the author and does not provide individually tailored investment advice. Electricity in indian villages It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Gasco abu dhabi location Investors are recommended to independently complete their own due diligence and evaluate any investment independently as well as to seek the advice of a financial advisor. Gas quality The appropriateness or legality of a particular investment will depend on an investor’s individual circumstances and investment objectives. Gas tax oregon The securities, instruments, or strategies discussed in this article may not be suitable for all investors, and certain investors may not be eligible to purchase or participate in some or all of them.

The article is not an offer to buy or sell or the solicitation of an offer to buy or sell any security or instrument or to participate in any particular trading strategy.