Should I sell my BP shares?

naseby_2

don't sell them now.
all such shares should be regarded as an investment for several years.
if you have a handful i'd suggest buying some now. BP is currently having difficulties.
These will be forgotten in 2 years time.

sabretoothtigger

Doubtful since we didnt forget exxon and that was 20 years ago. This spill is estimated by some to be spilling the equal of exxon every 8 days

Theres no doubt permanent loss to the balance sheet has occurred both in damages and futures prospects lost. The cost of cleaning on top of that will be 10 billion I think as the gulf is a far more populated and utilised area it will be twice as costly per barrel spilt I think

Taking all that into account, is the company only now worth half what it was previously? Probably not


I think BP should just donate the oil well to the gulf areas costs. It appears to have great pressure flow and its only fair the people had the downsides that they should gain all profits from its operations.

fuddyduddy12

Just a further question. Will the shareholders be in anyway legally liable for costs? I mean could we be forced to pay something towards the compensation fund/held legally responsible? Is the worst that can happen that our shares are devalued/BP goes bankrupt?

dunstonh

fuddyduddy12 wrote: »

Just a further question. Will the shareholders be in anyway legally liable for costs? I mean could we be forced to pay something towards the compensation fund/held legally responsible? Is the worst that can happen that our shares are devalued/BP goes bankrupt?

Your shares will go up and down and like any single company share, it could suffer a total loss. However, the liabilities are with the company not the shareholders.

bendix

stator wrote: »

You make money on the stock market by buying low and selling high, not the other way around.

How do you know what price the OP paid for his / her shares?

sabretoothtigger

Years ago there were such shares I think but I dont think they exist anymore. Directors used to bare liability for company losses, it was mentioned re: RBS


Shares suffer from being more vulnerable to devaluation then pref shares or corporate bonds. The company can just issue more shares and devalue you though I think they need a majority vote at a AGM. If theres big debts, shareholders are the first to lose money.

BP really screwed up but it doesnt compare to the banks just yet. Mostly it depends on the oil price still which is the parallel to house prices. If oil keeps going down and the company got its long term valuations vastly wrong then they are in trouble especially because of costs incurred otherwise a $70 barrel is fine and they are not another rbs

bendix wrote: »

How do you know what price the OP paid for his / her shares?

He only really has to know at the time of the OP posting the BP shares were the lowest price for over a decade

StevieJ

Interesting analysis.

Could BP be forced into bankruptcy by lawsuits, fines and penalties? It could be, but given the above cash flow numbers, I see that as unlikely. In addition, if backed into a corner by an administration more interested in finger-pointing and finding a scapegoat than in partnering with energy providers, BP could say “Enough. We cannot stand idly by as your whipping boy while you drive our company into bankruptcy.” If that happens, and they are forced to play hardball to survive, we need to remember that the value of the “responsible party” (BP America) is about $25 billion. Anytime the US government decides to finance its deficit spending and its various gifts to Wall Street by riding BP into the ground, BP “could” simply declare BP America insolvent and let everyone pick among its bones. That would still leave BP the 75% of its business conducted beyond US shores, with roughly 75% of its current $30 billion annual cash flow intact. I see the bankruptcy of the entire company as unlikely and assign only a 10% probability to that occurence.

http://www.stockopedia.co.uk/content/is-bp-plc-headed-to-70-or-0/43271