BP stock has risen 7% YTD despite lower Q1 profit, positioned well with oil focus.

From Nasdaq: 2025-06-23 00:05:00

BP plc stock (NYSE: BP) has risen about 7% year-to-date, trading at around $32 per share. Despite a lower-than-expected Q1 profit of $1.38 billion, BP remains positioned well with its emphasis on oil and gas. A strategic shift back to hydrocarbons and a discounted valuation compared to peers make BP an intriguing investment opportunity.

BP’s Q1 results showcased a mix of performance across its segments, with a decline in profit compared to the previous year. Looking ahead to 2025, the company expects lower upstream production and remains under pressure due to refining and fuel margins. The recent strategic pivot back to oil and gas signals a return to traditional energy priorities.

From a valuation perspective, BP appears undervalued with a price-to-sales ratio of 0.4x, below its historical average. The stock’s discounted valuation reflects investor caution over BP’s changing strategy and weaker earnings. However, this discount also offers potential upside if BP can stabilize its execution and deliver on its oil-forward approach.

Despite recent speculation, an M&A takeover of BP seems unlikely due to the company’s substantial debt and regulatory scrutiny. However, BP continues to focus on clean energy initiatives, particularly in hydrogen projects. The company’s commitment to hydrogen development and carbon capture projects demonstrates a continued interest in sustainable energy solutions.

BP’s strategic reset may not appeal to ESG-focused investors, but its discounted valuation presents an attractive opportunity for value-minded investors. Trading at a significant discount to peers, BP has the potential for upside if it can successfully execute its focused, oil-centric strategy. Investors looking for a less turbulent ride may consider the High Quality portfolio, which has outperformed the S&P with over 91% returns since inception.



Read more at Nasdaq: What’s New With BP Stock?