Analysts at UBS have slashed their expectations for oil company BP PLC (LSE:BP.)’s share price.
In a research note on Tuesday, the investment bank’s equity analysts cut their 12-month price target for the oil company to 600 pence per share, down from 640p.
They said the oil company’s shares "currently offer no value for low-carbon activities", but that electric vehicle (EV) charging and renewable gas will be key drivers for the stock in the coming year.
BP is still rated as a ‘buy’ by the bank’s analysts, who wrote that the company has "de-rated by 25% relative to the rest of the sector" over the past year.
The analysts said BP's stock has a number of "positive catalysts" in the near term, including today's confirmation that BP's interim chief executive Murray Auchincloss will permanently replace former CEO Bernard Looney in the role on a permanent basis.
UBS analysts also identified the potential for "higher dividends" at BP, saying that their estimates are about 5% above consensus.
They said BP's dividends "have the potential to positively surprise", with a possible increase in the proportion of surplus cash distributed as buybacks also on the cards.