BP plc (BP)’s Potential

BP plc (LON:BP) currently changes hand on a P/E rating of 8.6 for 2013, comfortably below the comparative readings for both its oil sector counterparts as well as the FTSE 100. It does not yield as much as its oil rivals, however, but the massive price variance more than compensates in my opinion.

Although the travails owing to the Gulf of Mexico disaster look set to rumble on, I believe that the long-term future looks good for BP plc (LON:BP) owing to its juicy production prospects. Its catalog of major assets across the globe are set to accelerate group output — the oil leviathan switched on five major projects last year, is set to bring another four online in 2013 and an additional six in 2014 — and it is making solid progress in both its upstream and downstream activities.

The firm is also handing back plenty of cash to investors in the form of share repurchases, and plans to return around $8 billion to investors over the next 12-18 months. Combined with potentially lucrative earnings catalysts, I believe that BP plc (LON:BP) is an income stock worthy of serious consideration.

The article A Closer Look at BP’s Dividend Potential originally appeared on Fool.com and is written by Royston Wild.

Motley Fool contributor Royston Wild has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.