Jefferies reaffirmed its price target for BP PLC (LSE:BP.) at £5.40 (a 42% premium to the current share price), citing its commitment to balancing shareholder returns against financial prudence.
The US investment bank kept its “buy” rating on BP, expressing confidence in the company’s ability to navigate current financial pressures including high debt levels.
It noted that BP is expected to sustain its quarterly buybacks at around $1.3 billion if oil prices remain stable at $75 per barrel.
While Jefferies acknowledged challenges related to BP’s debt load, it also highlighted BP’s efforts in divestments and operational efficiency, which could support cash flow and maintain share buybacks.
The bank anticipates that BP’s strategy update early next year will reveal more about its future buyback programme and debt reduction efforts, as it aims to achieve a balanced financial outlook.
In afternoon trading, the stock was flat at 377.65p.