In the latest trading session, Shell Oil (RDS.A) closed at $28.91, marking a -0.1% move from the previous day. This move was narrower than the S&P 500’s daily loss of 0.81%. At the same time, the Dow lost 0.56%, and the tech-heavy Nasdaq lost 1.27%.
Heading into today, shares of the oil and gas company had lost 7.39% over the past month, lagging the Oils-Energy sector’s loss of 0.34% and the S&P 500’s gain of 5.06% in that time.
Investors will be hoping for strength from RDS.A as it approaches its next earnings release, which is expected to be October 29, 2020. In that report, analysts expect RDS.A to post earnings of $0.15 per share. This would mark a year-over-year decline of 87.29%.
For the full year, our Zacks Consensus Estimates are projecting earnings of $1.02 per share and revenue of $252.14 billion, which would represent changes of -74.75% and -28.39%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for RDS.A. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 36% higher. RDS.A is currently sporting a Zacks Rank of #2 (Buy).
Digging into valuation, RDS.A currently has a Forward P/E ratio of 28.37. This valuation marks a no noticeable deviation compared to its industry’s average Forward P/E of 28.37.
It is also worth noting that RDS.A currently has a PEG ratio of 5.67. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Oil and Gas – Integrated – International was holding an average PEG ratio of 9.26 at yesterday’s closing price.
The Oil and Gas – Integrated – International industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 189, which puts it in the bottom 26% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.