Kepler Cheuvreux has upped its stance on BP PLC (LON:BP.) to 'buy' from 'hold', citing continuing momentum for the oil giant.
The French broker also raised its target price for the FTSE 100-listed firm to 650p from 530p, with the stock currently trading at 581.9p, down 0.1% on Wednesday’s close.
In a note to clients, Kepler’s analysts pointed to BP’s strong delivery in both its upstream and downstream businesses and noted that the firm “continues to show the right mindset, with strong capex discipline and commitment to shareholders.”
They noted that BP's upstream portfolio has swung back to growth with "impeccable" project delivery in 2017 - eight start-ups on schedule and under budget - and thinks 2018 is set to be a key year for delivery, with six projects on the cards.
The Kepler analysts also hiked their cash flow estimates for BP by around 10% over 2018-20 on the back of higher oil and natural gas prices, and sees the firm delivering US$28.7bn in cash flows in 2010 and US$13.2bn of free cash flow after tax.