Goldman raises BP price target; keeps at 'sell' saying fundamentals still challenged

Goldman Sachs raised its price targets on BP to 376p from 364p and $34.5 from $33.1, respectively, following the company’s settlement over the 2010 Gulf of Mexico oil spill, but retained its ‘sell’ rating on the stock saying the fundamentals remain challenged.

“Removing much of the uncertainty around this issue will likely be positive for sentiment,” said the bank.

However, it noted that while this will settle the major elements outstanding, the agreements do not cover the class action settlements with the Plaintiffs’ Steering Committee, or claims by individuals and businesses that opted out of the 2012 settlements.

“We remain Sell rated on the stock as we continue to see the outlook as being challenged in a low oil price environment, with limited production growth and a relatively high decline rate portfolio, fewer restructuring opportunities, and less flexibility than others to cut capex,” said GS.

At 1100 BST, BP shares were up 0.3% at 438.65p.