Its second-quarter revenue of $31.19bn plunged 57% from the past year period and missed analysts’ consensus by $7.5bn. The company has slashed dividends for the first time since the Second World War. It currently offers a quarterly dividend of $0.315 per share compared to an earlier dividend of $0.63 per share. BP said they will sustain dividends at current levels over the long-term, and plans to return money to investors through share buybacks once the oil market stabilizes. The company seeks to return 60% of surplus cash through share buybacks. Its share price soared surprisingly despite the historic loss and a change in dividend strategy. BP stock price soared close to 7% in pre-market trading amid investor’s strategy of buying on the dip. The market investors applauded the oil giant’s strategy of preserving cash during the testing times. The market analysts claim that the dividend cut is already priced into BP stock. Jefferies analyst Jason Gammel upgraded the stock to ‘buy’, saying that BP’s asset sale strategy has already generated enough cash for restructuring actions, with $36bn in cash and $18bn in undrawn facilities. The shares of the oil company plunged more than 40% this year.
