BP - 536p

BP is one of the largest UK-listed companies with a market capitalisation of more than £100 billion.

It is an instantly recognisable brand and certainly one of the most popular shares amongst private investors - the company has well in excess of a million shareholders.

However, the recent weakness in the oil price combined with a fall in output and worries that there may be trouble looming in Russia means the share has fallen out of favour somewhat.

Looking at the bigger picture, this presents an opportunity to buy BP at a price which is now lower than it was at any time during 2006.

Taking a long term view, BP remains highly cash generative and pays a well covered dividend which compares favourably with the vast majority of other companies. BP is truly a global business, with established operations in 100 countries across Europe, North and South America, Australasia and Africa.

It has approaching 30,000 service stations (with more than half of these being in the US) and employs in the order of 100,000 people worldwide.

The next key date is February 7, when final results for 2006 will be released. Not only will the figures be scrutinised by analysts, but comments made by the company will be keenly observed to check how prospects for the future lie.

Those seeking income might wish to consider making a purchase before the next ex-dividend date, which is expected to be February 21. Whilst it is often easier to uncover value amongst smaller companies than blue chips, the fact that BP shares have slid from a high point of more than 700p less than 12 months ago means that they currently represent good value based on fundamentals.

It is rare to see a company of such stature trading on a single figure P/E ratio, but this is the case for BP. Add to this the fact that the yield on the shares is around four per cent and you have the basis for a very attractive investment opportunity, which might not be available for too long.

There is a chance that the share price will show some recovery in the near term, in which case a trading profit could be banked. Should this not materialise, we are relaxed about keeping BP as a quality hold over the longer term. Consequently, we suggest that now is a good time to BUY.

WARNING: Opinions expressed are the writers' judgments at the time of writing. The information does not constitute a personal recommendation and readers should seek their own professional advice as to the suitability of the investments.