What’s the outlook for Beach Energy shares in FY23?

An oil worker assesses productivity at an oil rig as ASX 200 energy shares continue to riseAn oil worker assesses productivity at an oil rig as ASX 200 energy shares continue to rise

Shares of Beach Energy Ltd (ASX: BPT) have rallied in a sawtooth-like fashion since December 2021.

This year to date, the ASX energy player is up 32%, outpacing pretty much all other pockets of the market during that time.

What does FY23 hold for Beach Energy shares?

Energy markets have cooled in recent months. Brent Crude now trades back in line with April lows at US$100/barrel, signalling a wind back in the oil and gas trade.

Meanwhile, natural gas markets continue to run hot, with European gas contracts in particular locking in triple-digit gains.

As such, energy shares such as Beach continue to book substantial gains into the new financial year.

The question now turns to where Brent Crude and natural gas markets might head next, considering the short-term pullback.

Earlier in July, broker UBS revised its forecasts for oil and gas. It projects crude prices will retain support from investors amid a disrupted global oil supply.

It also projects an average 40% increase in LNG prices to North Asia by 2026, propelled by declining gas exports from Russia to Europe.

UBS says that this more dynamic pricing environment is set to provide a significant cash injection to Australian exploration and production companies.

As such, it raised its price target on Beach to $2.05 per share on a buy rating, signalling a 23% return potential should the broker prove correct.

Oil and gas markets

The debate on oil and gas markets is contentious and has players on both sides of the argument.

“Demand concerns continue to spook the oil market,” Refinifiv Oil Research wrote last week. It added:

The OPEC also came out with an outlook for global oil demand and economic growth, pegging the oil demand growth for 2023 at 2.7 million bpd, which is lower than the estimate of 3.36 million bpd for 2022, but still an optimistic forecast.

Despite the debate on forecasts and such, broker sentiment is still positive on the share.

Beach Energy is rated a buy from 11 of the 15 brokers covering its shares, according to Refinitiv Eikon data.

The consensus price target from this list is $1.97 per share, in line with August 2021 analyst projections, per Refinitiv.

Beach Energy shares are up 29% in the past 12 months.

The post What’s the outlook for Beach Energy shares in FY23? appeared first on The Motley Fool Australia.

Should you invest $1,000 in Beach Energy Ltd right now?

Before you consider Beach Energy Ltd, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Beach Energy Ltd wasn’t one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

See The 5 Stocks
*Returns as of July 7 2022

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);

More reading

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/OEZ5Nwm

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s