Oppenheimer Boosts Price Target For BP plc; Here’s Why

In a research report sent to investors today, Oppenheimer analyst Fadel Gheit maintained an Outperform rating on shares of BP plc. (NYSE:BP) and raised the price target to $50 (from $45), as he expects the company to be one of the few oil companies to have positive free cash flow in 2016. The new price target represents a potential upside of 20% from where the stock is currently trading.

Gheit noted, “Using the current strip benchmark oil and gas prices, we estimate BP operating cash flow of $22.5B in 2015 and $27.3B in 2016, after funding $20B CAPEX and $5.9B dividend in each year, we expect BP to have a free cash flow deficit of $3.6B this year and to be $1.3B free cash flow positive in 2016, before asset sales and share repurchase.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Fadel Gheit has a total average return of -13.6% and a 14.5% success rate. Gheit has a -6.7% average return when recommending BP, and is ranked #3505 out of 3505 analysts.

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