BP Share Forecast November 2021 – Time To Buy BP?

Shares of British multinational oil and gas company BP (LSE: BP) are in the green today, currently trading at 343.85p at the time of writing. BP performed well last month and has seen returns of 75% in the last 12 months. While the transition from gas and oil to renewables could cause some short-term issues for the company, many investors are wondering whether this is right time to pick up BP shares.

BP – Technical Analysis

According to the financial statement released by BP, the market cap of the company is at £67.393 billion with total assets worth £212.509 billion. Revenue for 2020 was at £140.65 billion with a profit margin of -11.26% compared to £218.22 billion in 2019.

Oscillators for BP such as Relative Strength Index (14)(49.03), Stochastic %K (14, 3, 3)(33.52), Commodity Channel Index (20)(−56.25), Average Directional Index (14)(19.72) and Awesome Oscillator(−5.75) are neutral. On the other hand, Moving averages such as Exponential Moving Average (50)(338.41), Simple Moving Average (50)(337.15), Exponential Moving Average (100)(326.72), Simple Moving Average (100)(319.02) and Exponential Moving Average (200)(316.11) are indicating a buy action.

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Recent Developments

The demand for oil and gas will prevail in some form as most products are hydrocarbons based. Analysts have found BP to be one of the leading renewable energy corporations that meet the existing petrochemical demands of late. Additionally, BP has vast potential for future growth as it works beyond gas and oil production. With a daily production of almost 2 million barrels of oil, BP also extends its services towards oil refining, producing petrochemical goods, energy trading and hydrocarbons shipping. BP’s concept of reimagining energy and increasing its renewable energy trade also adds to the Green Industrial Revolution. One can estimate that oil consumption will only reduce over the coming decades. However, the demand for oil (and oil derivate), fertilizers, usable forms of plastics and asphalt will continue to exist. At present, companies such as BP are focusing on developing alternatives comprising of several renewable energy projects.

BP aims at producing a total of 20 Gigawatt renewal energy by 2025 and 50Gigawatt by the end of 2035. Suggesting oil demands decrease over time, BP will incur profits from its renewable energy projects. BP focuses on preserving its financial standards while experiencing a shift towards renewable energy projects. Some of the perks include – Allowing them the benefit of choosing appropriate investments for its renewable energy production strategies and providing a consistent, goal-oriented and quality form of decision making backed up by BP’s robust performance in the oil market.

Data shows BP’s noticeable milestones of charging ten thousand EV charging points and aiming towards zero carbon emission by 2050. Renewal energy is the brand new concern standing in the critical era of environmental conservations. Investing in renewal energy (e.g. Fossil fuels) will generate long-term advantages for the future. Balancing between oil/petroleum and renewal energy sources is BP’s objective for the long haul.

Should You Buy BP Shares?

BP is now divesting in hydrocarbon assets. It is also reinvesting proceeds in the renewable energy projects under it. Management is aiming to take several steps to increase renewable energy capacity substantially. If the company moves down this path, the market’s opinion of the company will change, which could result in a higher valuation for the shares.

There are signs that the market is focussing too much on the company’s worst case scenario. But investors should note that the company has the financial resources and international footprint to become a leading renewable energy company while maintaining its existing petrochemical business. Considering these factors, you can add BP to your portfolio for long-term growth.

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