BP p.l.c. Common Stock (BP)

FairStock Score: 39/100 — MIXED

Key Financials

Strengths

• Generates $5.7 billion in annual free cash flow (4.8% yield on market cap)
• Attractive 4.3% dividend yield providing steady income returns
• Established organization with 93,700 employees providing operational scale

Concerns

• Trades significantly above Graham Number ($1) with negative 3596% margin of safety—limited downside protection
• Currently unprofitable—sustained losses could lead to dilutive capital raises or balance sheet deterioration
• Altman Z-Score of 0.6 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

BP p.l.c. Common Stock is a large-cap energy company valued at $119.0 billion. Revenue stands at $187.6 billion, though the company is currently unprofitable. From a quality standpoint, BP shows distressed Altman Z-Score of 0.6 warrants caution and modest 2% ROE. On valuation, the stock is commanding a steep 2317.5x multiple, with trades far above its Graham Number ($1) with no margin of safety. Growth dynamics show revenue growing at 3.6% and profit growth of -74.7%. The 4.3% dividend yield adds an income component for patient holders. Our composite FairStock Score of 29/100 reflects below-average fundamentals overall. The premium valuation demands continued execution and leaves limited room for disappointment.

Bull Case

BP's dominant market position and scale advantages create a durable moat that supports premium valuation over time. With $5.7 billion in annual free cash flow (4.8% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 2318x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Sluggish 4% growth in a large-cap company leaves the stock vulnerable to de-rating if the market rotates toward higher-growth opportunities.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer