BP shares are up 0.5% this morning on chatter about a possible split between its refinery arm and exploration and production business.
JPMorgan Cazenove said BP’s assets equate to a market value of about $248 billion, according to Bloomberg. The company currently trades at about $147 billion.
JO Hambro Capital Management Group Ltd.’s Clive Beagles wrote: “On a sum of the parts basis, BP is ludicrously undervalued. Perhaps that means they need to take as radical a route as ConocoPhillips, or articulate a better strategy.”
ConocoPhillips and Marathon Oil Corp announced splits between upstream and downstream businesses earlier this year. A similar approach could help BP cordon off damage from the Gulf of Mexico oil spill and a failed exploration deal with Russia’s OAO Rosneft — both upstream problems.