3 Highest Rated Foreign Oil Stocks to Buy Now
Oil prices peaked in seven years Friday amid growing geopolitical tensions and a winter storm in the United States. The international oil benchmark, Brent, gained 1.7% to trade at $92.67 a barrel. West Texas Intermediate crude, the US oil benchmark, rose 1.9% to $92.02 a barrel. Both benchmarks were on track for a seventh consecutive weekly gain.
Oil demand is expected reach 100.23 million barrels per day (mb/d) in 2022, up 3.5 MB/d from 2021 and above pre-pandemic levels in 2019. Despite pressure from major consumers such as the United States and India to ramp up production faster, OPEC+ decided to stay put in its production increases.
Against this backdrop, we believe foreign oil stocks, BP plc (BP), Eni SpA (E), Petroleo Brasileiro SA – Petrobras (ACB) are ideal additions to your portfolio.
BP plc (BP)
BP is involved in the energy sector worldwide. It operates through gas and low-carbon energy; Petroleum production and operations; Customers & Products; and segments of Rosneft. The company is headquartered in London, UK.
In October 2021, Cognite announced that it had signed a multi-year agreement with BP to use Cognite’s Industrial Data Operations solution to increase the efficiency and sustainability of well operations. “BP is excited to extend its strategic partnership with Cognite to focus on optimization through contextualized data,” said Ahmed Hashmi, senior vice president of digital, production & business services, BP.
For the third quarter of fiscal 2021, total revenue and other income increased 44.2% year over year to $37.87 billion. This can be attributed to a 37.5% increase in sales and other operating income over the prior year quarter to $36.17 billion. Net cash from operating activities was $5.98 billion, up 14.8% from the same period a year earlier.
Street expects the company’s revenue to grow 34.6% year-over-year to $46.50 billion in the fiscal first quarter ending March 2022. The estimate EPS consensus of $1.14 indicates a 45.6% year-over-year increase. Additionally, BP has exceeded consensus EPS estimates in three of the past four quarters, which is impressive.
BP shares have gained 51.2% over the past year and 25.2% over the past six months to close its last trading session at $32.15.
BP POWR Rankings reflect this promising prospect. The company has an overall rating of B, which translates to Buy in our proprietary rating system. POWR ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree. BP has an A rating for Momentum. In stock 46 Foreign oil and gas industry, it is ranked #27. The industry is rated A.
In addition to the POWR ratings we have shown above, one can see the additional BP ratings for Growth, Value, Stability, Sentiment and Quality. here.
Eni Spa (E)
Based in Rome, Italy, E explores, develops and produces crude oil and natural gas. It operates through Exploration & Production; global gas and LNG portfolio; Refining & Marketing and Chemicals; Eni gas e luce, Power & Renewables; and the Corporate and Other Activities segments.
On October 29, E announced that it had started the process of launching the IPO of its new businesses comprising EGL divisions, retail, renewable energy production and electric vehicle charging points. The company expects to complete the transaction in 2022.
E’s adjusted operating profit increased 364.1% year-on-year to 2.49 billion euros ($2.83 billion) in the third quarter of fiscal 2021. Its adjusted net profit, attributable to shareholders of E, increased by 1,035.3% compared to the value of the previous year at €1.43. billion ($1.62 billion), while its value per share rose 1,100% from its value a year ago at €0.40.
The consensus revenue estimate of $89.04 billion for fiscal year 2022 indicates a 10.7% year-over-year increase. Similarly, the consensus EPS estimate for the same period of $3.12 reflects a 45.1% increase over the prior year. Additionally, E has an impressive surprise earnings track record, beating consensus EPS estimates in three of the past four quarters.
The stock has gained 47.5% over the past year and 26.9% over the past six months to close its last trading session at $30.63.
It’s no surprise that E has an overall rating of B, which translates to Buy in our proprietary rating system. The stock has an A rating for Momentum and Sentiment and a B rating for Growth and Stability. It is ranked No. 13 in the foreign oil and gas industry. Click here to see E-ratings for value and quality.
Petroleo Brasileiro SA – Petrobras (ACB)
Based in Rio de Janeiro, Brazil, PBR produces and sells oil and gas internationally. The Company operates through exploration and production; Refining; Transportation and Marketing; gas and electricity; and the Business and Other Activities segments.
On December 9, TechnipFMC plc (IFT) announced that PBR had awarded it three framework agreements. The agreements reflect PBR’s desire to increase its oil recovery in its brownfield developments, primarily in the post-salt fields offshore Brazil.
PBR’s sales revenue increased 76.9% year over year to $23.26 billion in the third quarter of fiscal 2021. Its gross profit was 81.4% year-on-year quarter at $11.39 billion, while consolidated net profit attributable to shareholders of PBR came to $5.94 billion, indicating a 2,616.1% improvement from a year to year. Adjusted sound EBITDA rose 87% from its value a year ago to $11.62 billion.
Analysts expect the company’s revenue to grow 61.8% year-over-year to $85.19 billion in fiscal 2021. Similarly, Street expects that EPS improved by 495.3% over the previous year to reach $2.21 for the same period.
Over the past year, the stock has gained 21.8% and 24.8% over the past six months to close its last trading session at $13.34.
PBR’s POWR ratings reflect its strong fundamentals. The company has an overall rating of B, which translates to Buy in our proprietary rating system. PBR has a Momentum and Quality rating of A. It is ranked #19 in the same industry. To view additional PBR ratings for Growth, Value, Stability and Sentiment, Click here.
BP shares were trading at $33.02 per share on Friday afternoon, up $0.87 (+2.71%). Year-to-date, BP has gained 24.00%, versus a -4.74% rise in the benchmark S&P 500 over the same period.
About the Author: Subhasree Kar
Subhasree’s keen interest in financial instruments led her to pursue a career as an investment analyst. After earning a master’s degree in economics, she gained knowledge in equity research and portfolio management at Finlatics. Following…