From Morningstar:

1. BP Shares Surge After Announcing Buybacks and Strong Profits: Shares in BP saw a 6% rise as the oil giant announced higher-than-expected fourth quarter profits and $3.5 billion buybacks in the first half of the year, despite full-year profits being nearly halved from the previous year.

2. Profits Inflated by Russia-Ukraine Conflict: Profits in 2022 were inflated by the impact of the Russia-Ukraine conflict on the oil price, leading to calls for increased windfall tax on oil companies as oil prices have since softened considerably.

3. Strongest Results Since 2012: Despite lower profits, 2023 results were the strongest since 2012, with a 10% increase in fourth-quarter dividend. BP’s buyback pledge of $3.5 billion now matches that of Shell.

4. BP’s Financial Metrics and Fair Value Estimate: BP shares are trading below their fair value estimate of £5.60, with a Morningstar Rating of ★★★★ and high uncertainty rating.

5. Personnel Drama over CEO Conduct: Former CEO Bernard Looney resigned over misconduct claims, with Chief Financial Officer Murray Auchinloss confirmed as CEO. Auchinloss is focusing on generating surplus cash flow and prioritizing shareholder value.

6. All Eyes on the BP AGM and Net Zero: Climate change protests disrupted last year’s AGM, and there are expectations for the same this year. BP faces pressure to stretch climate transition ambitions and find a balance between short-term returns and long-term transformation.



Read more: BP Shares Surge After Earnings and Buybacks