British Petroleum :

Although there isn’t any important difference in the P/E ratio, the earnings per share of BP have elevated nearly 30% in the final 5 years and BP’s P/E ratio is forty one% of the industry (www.fidelity.com).
Internet profit margin:
7.2%—-2007 eight.1%—-2006 eight.9%—-2005
Internet revenue margin has barely decreased over the last three years, but remains to be over 5%, the rate at which many traders consider to be a good place. In comparison with the trade, BP’s revenue margin is properly beneath the typical and four% below Exxon Cell.
Dividend yield:
3.5—-2007 three.Four—-2006 three.3—-2005
BP’s dividend yield has made it a very engaging investment and presently at around 5%. Columbine believes the corporate to be undervalued by Wall Street requirements, anticipating higher future earnings.
Liquidity Measures
Working capital
$2971—-2007 $(thirteen)—-2006 $3793—-2005
Within the final year, BP has confirmed to be able to cover obligations once due.
Current ratio:
1.04—-2007 .999—-2006 1.05—-2005
The current ratio being above 1 is an effective indicator that the company’s brief term debts are less than its property exhibiting that it is in a very good financial position.

Ceramic pall ringFinancial Leverage Measures
Debt/fairness:
33%—-2007 28%—-2006 24%—-2005
Though the debt/equity ratio has increased over the past three years, 33% is an appropriate price and is above the industry average of twenty-two%.
Debt ratio:
.6—-2007 .6—-2006 .6—-2005
BP has held fixed the debt ratio and has proven to be able to take care of its debt funds. In keeping with Compustat, its debt is typical for the trade.
Activity Measures
Complete asset turnover:
1.22—-2007 1.24—-2006 1.18—-2005
BP has carried out a terrific job historically of turning over its belongings to gross sales and is comparable to the trade average of 1.2.
The following charts display BP’s inventory evaluation along with BP’s two major opponents:
BP
Date/Time
four:01 p.m.
Last
64.32 (N)

Change
-0.21 (-zero.33%)
Bid (Bid Size)
N/A (N/A) (O)
Ask (Ask Dimension)
N/A (N/A) (P)
Earlier Close
sixty four.53
Open
64.64
Day Range
63.Seventy two – 64.85
52-Week Range
57.85 – 79.77
Quantity
4,215,739
Last Trade Quantity
three,four hundred
Block Trade Depend
6
Earnings/Share
7.12
P/E
9.03
Dividend/Share
2.922
Dividend Yield
four.54%
Beta
zero.86
Ex Dividend Date
05/14/2008

Supply: Merrill Lynch

CHEVRON CORP COM (CVX)
Date/Time
four:05 p.m.
Final
ninety two.80 (N)

Change
+0.Fifty five (+zero.60%)
Bid (Bid Dimension)
N/A (N/A) (P)
Ask (Ask Measurement)
N/A (N/A) (O)
Earlier Shut
ninety two.25
Open
92.61
Day Vary
91.50 – 93.31
fifty two-Week Range
76.40 – 104.Sixty three
Volume
11,631,724
Final Trade Volume
279,900
Block Commerce Rely
8
Earnings/Share
eight.35
P/E
eleven.11
Dividend/Share
2.600
Dividend Yield
2.Eighty%
Beta
0.Ninety seven
Ex Dividend Date
05/15/2008

Supply: Merrill Lynch
EXXON MOBIL CORP COM (XOM)
Date/Time
4:01 p.m.
Last
85.Forty two (N)

Change
-zero.06 (-0.07%)
Bid (Bid Dimension)
N/A (N/A) (O)
Ask (Ask Size)
N/A (N/A) (O)
Earlier Shut
85.Forty eight
Open
86.00
Day Vary
84.48 – 86.Forty seven
52-Week Vary
77.55 – 96.12
Volume
21,475,416
Final Commerce Volume
517,900
Block Trade Count
eleven
Earnings/Share
7.69
P/E
eleven.11
Dividend/Share
1.600
Dividend Yield
1.87%
Beta
1.03
Ex Dividend Date
05/09/2008

Supply: Merrill Lynch
Looking at P/E alone BP would not be a sensible investment; nevertheless, factoring in the dividend yield and beta values, BP becomes a comparatively stable company. Merrill Lynch defines the time period “betaas:
A value that measures a fund’s relative volatility, as compared to a typical market index, such because the S&P 500. (By definition a market’s beta will at all times be equal to 1.) A Fund with the next beta (more than 1) is extra volatile than the market.
As a result of BP is such a stable firm, analysts suggest either holding onto the inventory or shopping for more all through the fiscal 12 months. The following graph exhibits analysts rankings discovered on MSN Money:
Analyst Rankings
Recommendations Current 1 Month Ago 2 Months Ago three Months In the past
Robust Purchase eight 8 9 9
Moderate Purchase zero zero 0 0
Hold 3 four 5 5
Moderate Promote 2 2 1 1
Sturdy Sell zero zero 0 0
Mean Rec. 1.92 2.00 1.87 1.87

The graph below displays BP’s stock costs during the last 12 months.

SWOT Evaluation
Strengths:
British Petroleum is the second largest oil and gas company working immediately within the United States right this moment primarily based on market capitalization. British Petroleum enjoys providing gas and crude oil to more than 100 nations. At this time the corporate has more than 13 million prospects by offering product to greater than 28,500 service stations world wide every day.
British Petroleum has built-in operations in each the upstream and downstream oil enterprise. The company has three foremost business segments that they operate by way of, exploration and manufacturing; refining and advertising; and gas, energy and renewables. These vertically built-in operations present advantages to British Petroleum by means of your complete value chain.
British Petroleum has a really widespread source of revenues. This helps British Petroleum cut back the impression of market volatility and offers the corporate with financial stability.
Weakness:
British Petroleum has several weaknesses that are having an impact on their operations. British Petroleum’s crude oil and gas reserves have declined considerably over the previous a number of years. This has had an damaging affect on their operating margins.
British Petroleum has additionally seen in a decline in their revenue per employee over the past a number of years as in comparison with their rivals. The weak income per employee of the company in comparison with the competitors signifies its weaker productivity and operational efficiency.
Alternatives:
The corporate is nicely positioned to deal with the growing need for natural gas. This may allow them to faucet into these assets to assist meet the growing want for natural gas on a global perspective.
British Petroleum can be positioned nicely to satisfy the rising need for oil in China. This alternative shall be brief lived as China ramps up its personal manufacturing over the subsequent three a long time.
There is an increasing want for jet gas. Air BP, a specialized gas and lubricant division of BP is among the world’s largest suppliers of aviation gas, supplying over 488,000 barrels per day.
Threats:
There are three major threats that exist in the present day. One is the saturation of the drilling efforts within the North Sea area. More and more dry holes are being drilled as we speak. This is a area the place BP has important drilling operations.
Another menace is the instability we see in many of the oil rich areas akin to Africa, the Middle East, and South America.
Lastly there may be the environmental menace. Regulations proceed t o hamper their means to drill in some places. The major environmental threat is the Kyoto protocol for the reduction of greenhouse gases. BP already has a weak document on this area and cannot afford more stringent laws which will impose new liabilities to them.

Works Cited
“Compustat Company Research.” www.fidelity.com. July 11 2008. Compustat. 13 Jul 2008 .
“BP plc (ADR).” www.fidelity.com. July 11 2008. Columbine Capital Providers. 13 Jul 2008 .
“Ned Davis Analysis Analysis.” www.fidelity.com. July 3 2008. Ned Davis Analysis, Inc.. Thirteen Jul 2008 http://research2.fidelity.com/fidelity/analysis/reports/pdf/getReport.asp?dockey=5010-BP-RFSHI6EVC24S524BPGEBMOJF7&docTag=BP&version=2RFSHI6EVC24S524BPGEBMOJF7&feed=5010>.
“Benefits Online.” Merrill Lynch. 14 July 2008. ILX Systems. 14 Jul 2008 .
“BP ADR Each Representing Six Ord Shs: Analyst Ratings.” MSN Money. 14 July 2008. Zacks Investment Research.

Should you liked this informative article and also you want to receive details relating to petroleum equipment suppliers generously check out our webpage.