BP PLC
Find Ratings ReportsBP PLC's gross profit margin for the second quarter of its fiscal year 2016 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased. BP PLC has weak liquidity. Currently, the Quick Ratio is 0.81 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has decreased by 12.62% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.
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| Income Statement | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Net Sales ($mil) | 46442.0 | 62051.0 |
| EBITDA ($mil) | 4999.0 | 5753.0 |
| EBIT ($mil) | 1362.0 | 1988.0 |
| Net Income ($mil) | -1419.0 | -5823.0 |
| Balance Sheet | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Cash & Equiv. ($mil) | 23624.0 | 32883.0 |
| Total Assets ($mil) | 263136.0 | 285431.0 |
| Total Debt ($mil) | 55727.0 | 57104.0 |
| Equity ($mil) | 92726.0 | 106119.0 |
| Profitability | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Gross Profit Margin | 17.42 | 14.97 |
| EBITDA Margin | 10.76 | 9.27 |
| Operating Margin | 2.93 | 3.2 |
| Sales Turnover | 0.73 | 1.0 |
| Return on Assets | -2.0 | -2.22 |
| Return on Equity | -5.67 | -5.97 |
| Debt | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Current Ratio | 1.25 | 1.39 |
| Debt/Capital | 0.38 | 0.35 |
| Interest Expense | 291.0 | 281.0 |
| Interest Coverage | 4.68 | 7.07 |
| Share Data | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Shares outstanding (mil) | 3129.53 | 3053.15 |
| Div / share | 0.6 | 0.6 |
| EPS | -0.46 | -1.91 |
| Book value / share | 29.63 | 34.76 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 7503952.0 | 9767491.0 |
HOLD. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. For additional comparison, its price-to-book ratio of 1.16 indicates a significant discount versus the S&P 500 average of 2.82 and a significant discount versus the industry average of 15.56. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, BP PLC proves to trade at a discount to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| BP NM | Peers 80.60 | BP 6.34 | Peers 10.97 | |||||||||||||||||||||
|
Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings. BP's P/E is negative making this valuation measure meaningless. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. BP is trading at a significant discount to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| BP 14.05 | Peers 49.84 | BP NA | Peers 3.87 | |||||||||||||||||||||
|
Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations. BP is trading at a significant discount to its peers. |
Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. Ratio not available. |
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| Price/Book |
|
Earnings Growth |
|
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| BP 1.16 | Peers 15.56 | BP 17.79 | Peers -227.20 | |||||||||||||||||||||
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Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. BP is trading at a significant discount to its peers. |
Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. BP is expected to have an earnings growth rate that significantly exceeds its peers. |
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| Price/Sales |
|
Sales Growth |
|
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| BP 0.56 | Peers 2.58 | BP -32.40 | Peers -26.14 | |||||||||||||||||||||
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Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. BP is trading at a significant discount to its industry on this measurement. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. BP significantly trails its peers on the basis of sales growth |
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