JP Morgan upgrades its recommendation for BP to overweight from neutral and raises its price target to 675 pence from 550 pence. At the same time, Totalenergies is downgraded to neutral. Investing.com reports this.
The bank expects BP’s leverage to start improving in the second half of 2026 and estimates free cash flow yield in 2027 at 11 percent at a Brent price of 75 dollars per barrel. JP Morgan also sees support from a more favorable macro environment and the company’s restructuring.
For Totalenergies, the corresponding free cash flow yield is 9 percent. The bank believes that the company’s strong fundamentals are partly priced in and also points to its exposure to the Middle East and lower production growth as reasons for the downgrade.
