Is Now the Time to Buy BP?
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Nov
5
Ida Hansen
Is Now the Time to Buy BP?
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There have been many articles on this site that have recommended investing in Big Oil companies such as Chevron (NYSE: CVX) and ConocoPhillips (NYSE: COP).  A recent piece focused on the potential for profits from Royal Dutch Shell (NYSE: RDS-A) and ExxonMobil (NYSE: XOM) rebounding after weak earnings.  As long term investments, these stocks will provide a solid total return.  BP (NYSE: BP) now looks to be recovering, with a great deal of upside.

BP fell due to the disaster in the Gulf of Mexico in 2010.

It has been fighting its way back since.  But the company was never in danger of going under.  Despite that, the stock price fell greatly, as to be expected. With the company emerging from the legal morass, the share price has been rising, as to be expected.

There is much to like about BP as a long term investment.

It has a global presence.  That will critical for growth in the decades ahead as the great majority of the increasing energy demand in the world will be in emerging market nations.  BP will be able to capture much of the growth due to its operations around the world.

In recent market action, the energy sector has been weak.

But that is not the case with BP, as shown by the chart below.  It has been soaring as investors are piling back in due to its bullish future and undervalued assets.  With an above average dividend of 4.60%, there is a flow of capital to shareholders to please all income investors.  The total return should be equally as rewarding.

 



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