Oil and gas major BP Plc (GB:BP) announced the appointment of interim CEO Murray Auchincloss as the company’s permanent chief. The energy giant has been on a hunt for an apt leader after former CEO Bernard Looney stepped down in September last year. Looney was accused of not disclosing his relationships with colleagues. BP shares are down 1.1% at the time of writing.
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Auchincloss Considered to be the Apt Choice
FTSE 100-listed BP plc is steadily transitioning from an integrated oil company (IOC) to an integrated energy company (IEC), a strategy initiated by the ex-CEO. Auchincloss will continue to pursue the company’s IEC transition as more and more economies shift toward decarbonization. Auchincloss believes that BP can create massive value by becoming a renewable energy company.
Auchincloss was a CFO when Looney exited. The search for a suitable CEO led the board to Auchincloss’ door, with the belief that he is an “outstanding candidate and is the right leader for BP.”
BP’s share price has been under pressure since Looney’s departure. The stock has lost over 17% in the past three months. Many industry wizards were speculating that BP would become a potential takeover target. Given that Auchincloss has a sound and deep understanding of BP’s operations and the energy sector, expectations for the company’s quick turnaround run high.
Is BP a Buy, Sell, or Hold?
Following the CEO appointment news, a few analysts reviewed their ratings on BP stock. RBC Capital analyst Biraj Borkhataria maintained a Buy rating on BP with a price target of 600.00p (34.5% upside). The analyst recommends investors buy the stock as the uncertainty of having an external CEO is now discarded. Also, he suggests that investors must now focus on BP’s “portfolio, underlying growth and potential returns.”
At the same time, Jefferies analyst Giacomo Romeo stuck to his Hold rating on BP stock with a price target of 520.00p (16.6% upside).
Overall, BP stock has a Moderate Buy consensus rating on TipRanks based on eight Buys, three Holds, and one Sell rating. The BP Plc share price forecast of 626.25p implies 39.9% upside potential from current levels.
