Big Oil

Two oil companies form the first and second largest shares in the FTSE100. BP (LSE: BP.) and Royal Dutch Shell (LSE: RDSB). Both of these offer value in the sense that they are cheaper than the market on several popular measures but let’s see if there may be any mileage in them as short-term value plays. The following table shows some typical value data. P/E and yield are forecast, P/TBV and debt are historical as is P/S, being Price/Sales and P/CF being Price/Cashflow.

I dunno but a popular view seems to be a fall over the next year or two and this I expect is where the declining eps picture has its origins amongst analysts. Do you buy this story? It’s risky of course but it may be worth considering going against the popular view.

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