BP Set To Report Q4 Earnings As Elliot Management Builds Stake: Declining Margins, Revenues In The Spotlight

BP p.l.c. BP shares are trading higher Monday after the Wall Street Journal reported that activist investment fund Elliot Management had taken a stake in the London-based oil company.

BP is also set to report its fourth-quarter results ahead of Tuesday's opening bell. Here's a look at what Wall Street will be watching in the report. 

What To Watch: BP shares have fallen over the past year. The company struggles with weaker oil and gas production and declining refining margins. It also cut 4,700 jobs in January, roughly 5% of its workforce, and removed over 3,000 contractor positions as part of its cost reduction efforts. 

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BP anticipates a decline in Q4 upstream production compared to the previous quarter, with decreases in both oil and gas and low-carbon energy output. BP has also warned of potential non-cash, post-tax impairments ranging from $1 billion to $2 billion in its report due out on Tuesday morning. 

According to estimates from Benzinga Pro, analysts expect BP to report earnings of 47 cents, a steep decline from $1.07 per share reported in the same period last year. The consensus revenue estimate is for $47.51 billion, down from $53.5 billion in the prior year's quarter. 

BP investors anticipate potential strategic changes driven by the involvement of Elliot Management. 

The size of Elliot's stake is unknown, but the firm is encouraging BP to "consider more dramatic moves than it has made so far to restore the once venerable company's fortunes," sources told the Wall Street Journal. 

Price Action: According to data from Benzinga Pro, BP shares are up 6.66% at $34.42 at the time of publication Monday.

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