The Ampol Limited (ASX: ALD) share price is inching higher today, up 0.86% to $28.08 at the time of writing.
It's been a difficult period for the petroleum giant these past 3 months, with shares trading as high as $31.95 in November before retracing backward to their current levels.
Add in that shares are trending in a sideways channel over the last 12 months, and the recipe is becoming more and more flavourless for Ampol shareholders.
So with these points in mind, we ask, is Ampol a buy? Let's take a closer look at what the experts are saying.
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What's Jefferies saying about Ampol?
The team at investment bank Jefferies notes that Viva Energy Group Ltd (ASX: VEA)'s recent upgrade to earnings guidance bodes well for Ampol.
Jefferies points out that Ampol is Viva's major competitor in the Australian petroleum refining and marketing segment. As a result, any upgrade to Viva's earnings outlook transposes as a positive catalyst to Ampol.
In a recent note, Viva advised it expects earnings before interest, taxes, depreciation, and amortisation (EBITDA) to come in at $470 million to $490 million in 2021, which is a substantial jump of almost 20% from median Jefferies forecasts.
The broker notes that Viva's upgrade was likely due to margin performance at the refining and retail segments. While it acknowledges that "Viva is likely outperforming in both commercial and retail", it concurrently believes "these dynamics augur in well for Ampol".
Jefferies says it "remains positive on both stocks given leverage to COVID recovery and attractive valuations". For reference, Ampol is currently trading at 14.6x price to earnings (P/E) and just under 2.3x price to book (P/B).
The team at Barrenjoey Capital Markets recently upgraded its rating on Ampol as well, recommending it as overweight with a $36.68 valuation.
This sentiment appears to be shared with the majority of analysts covering Ampol, according to Bloomberg Intelligence.
From the list of analysts covering Ampol almost 60% reckon it is a buy right now, with a consensus price target of $33.74. This consensus valuation offers a 12-month return potential of around 20% from the current market price.
What are other analysts saying about the Ampol share price?
With respect to some specific valuations, Credit Suisse has Ampol as neutral at a price target of $29.53, whereas Morgan Stanley likes the shares and rates Ampol as a buy at a $35 per share valuation.
RBC Capital Markets holds the same view and rates Ampol a buy with a $33 per share price target. In contrast, Barclay Pearce isn't as rosy and reckons the company is a hold at $24.91 per share.
The number of analysts covering Ampol and rating it a buy has crept down gradually over the last 12 months.
This downward move has occurred alongside the Ampol share price, which has also slipped around 1.5% into the red in that same time.
