BP (BP) should provide clarity on its medium-term growth targets and balance sheet goals amid the ongoing boardroom drama with the recent removal of Chair Albert Manifold, RBC Capital Markets said in a note Thursday.
Albert Manifold, who was recently removed as chair, was seen as an "agent of change" by many investors, according to the note. Management has said the company's strategy is unchanged, and analysts said they continue to see potential for the stock to outperform peers, but investors will need consistency in governance.
The key to dispelling investors' hesitation due to the boardroom drama is for BP to show it can deliver on its strategic goals of de-leveraging and structural cost reduction, the investment firm said.
The company reported a net debt target of $14 billion to $18 billion by the end of 2027, but analysts, along with many investors, believe this can be achieved by the end of 2026. BP's net liabilities should be around $30 billion instead of the current $56 billion, implying a reported net debt of about $5 billion, which can be attained by mid-2027, analysts said, adding that the company can "surprise positively" on debt reduction.
RBC reiterated an outperform rating on the stock, with a price target of 700 British pence.
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