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There are still 26 letters in the English alphabet, even if the Brits and the Yanks call the last letter by different names. Have you ever wondered which is correct? You might find it interesting that the Dictionary.com defines “zee” as “the U.S. word for “zed.” That ought to set the record straight. But, I digress. This article is not about THE alphabet. It’s about THE OTHER Alphabet (NASDAQ:GOOG), the one we commonly call Google. Alphabet is the umbrella company. BP (LSE:BP) needs no explanation.
Alphabet Is Making History
Whilst markets are down and Brent crude is now selling at $33.72 per barrel, Alphabet/Google is breaking new records, with earnings per share of $8.67 on $21.33 billion in revenue. These numbers beat analysts’ estimates like Cruz beat Trump in the Iowa caucuses, covering expectations of $8.10 on $20.77 billion.
GOOG shares have remained rather consistently above 700.00 since 15 October 2015, reaching 776.70 on 29 December 2015, before falling to 699.99 on 27 January 2016. Shares began rising in anticipation of a healthy earnings report, closing at 752.00 and continuing to advance in after-hours trading. GOOG is currently trading at 776.80.
The big news, however, is that, defying Sir Isaac Newton’s observations, Google did not get knocked on the head by Apple. Rather, it soared beyond the Apple (NASDAQ:AAPL) in market capitalization, making it (much to the dismay of Apple) the most valuable company in the U.S., with a market cap of $534.36 billion compared to Apple’s $528.04 billion.
In a bit of understatement, Revere Security Corp.’s Scott Fullman said that GOOG “has been tracking very well given the volatility in the market, dominated by falling energy prices and weakness from China.” Which bring us to BP.
BP Is Making History
Unfortunately, BP (LSE:BP.) is not making history of the ilk that GOOG has. Rather, BP has reported a 91% decline in Q4 revenues and its worst annual loss in company history at $5.2 billion. The company announced that it “will slash its spending by $9 billion and lay off 4,000 workers in this fiscal year.
Nonetheless, CEO Bob Dudley clearly understands that there is a storm yet to be weathered, forecasting that oil prices will be lower for longer, but not forever, although he added that “2016 is going to be tough.”
BP’s strategic plan for 2015 was based on oil being priced at $50 per barrel, which should help investors better understand the reason behind the magnitude of the loss. BP’s strategy was sound. It’s strategy moving forward appears to be just as wise. “Capital spending over the next two years is expected to stay between $17 billion and $19 billion and it plans to sell off $3 billion to $5 billion worth of assets this year.”
The current status of both Alphabet and BP are clear indications that no one at either company is asleep at the wheel regardless of whether the road ahead is clear as day or dark as night.
