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Shell (SHEL) Stock Drops Despite Market Gains: Important Facts to Note

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In the latest trading session, Shell (SHEL - Free Report) closed at $71.10, marking a -1.66% move from the previous day. The stock fell short of the S&P 500, which registered a gain of 0.14% for the day. At the same time, the Dow added 0.2%, and the tech-heavy Nasdaq gained 0.27%.

Prior to today's trading, shares of the oil and gas company had lost 0.33% lagged the Oils-Energy sector's gain of 2.89% and the S&P 500's gain of 3.97%.

Analysts and investors alike will be keeping a close eye on the performance of Shell in its upcoming earnings disclosure. The company is expected to report EPS of $1.44, down 26.9% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $74.34 billion, down 0.95% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates project earnings of $6.32 per share and a revenue of $291.12 billion, demonstrating changes of -15.96% and +0.72%, respectively, from the preceding year.

Investors should also take note of any recent adjustments to analyst estimates for Shell. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 2.76% rise in the Zacks Consensus EPS estimate. Shell is holding a Zacks Rank of #3 (Hold) right now.

With respect to valuation, Shell is currently being traded at a Forward P/E ratio of 11.44. Its industry sports an average Forward P/E of 11.14, so one might conclude that Shell is trading at a premium comparatively.

We can additionally observe that SHEL currently boasts a PEG ratio of 1.98. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Oil and Gas - Integrated - International industry was having an average PEG ratio of 1.98.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. At present, this industry carries a Zacks Industry Rank of 170, placing it within the bottom 32% of over 250 industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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