Back to top

Image: Bigstock

Shell Oil (RDS.A) Gains As Market Dips: What You Should Know

Read MoreHide Full Article

In the latest trading session, Shell Oil (RDS.A - Free Report) closed at $58.52, marking a +0.09% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.04%. Meanwhile, the Dow lost 0.1%, and the Nasdaq, a tech-heavy index, added 0.05%.

Heading into today, shares of the oil and gas company had lost 0.44% over the past month, lagging the Oils-Energy sector's gain of 1.63% and the S&P 500's gain of 2.48% in that time.

Investors will be hoping for strength from RDS.A as it approaches its next earnings release, which is expected to be January 30, 2020. On that day, RDS.A is projected to report earnings of $1.08 per share, which would represent a year-over-year decline of 21.17%.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.45 per share and revenue of $323.80 billion. These totals would mark changes of -13.76% and -18.06%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for RDS.A. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.15% lower. RDS.A is currently a Zacks Rank #3 (Hold).

Investors should also note RDS.A's current valuation metrics, including its Forward P/E ratio of 13.15. Its industry sports an average Forward P/E of 13.21, so we one might conclude that RDS.A is trading at a discount comparatively.

Investors should also note that RDS.A has a PEG ratio of 2.63 right now. 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 industry currently had an average PEG ratio of 1.81 as of yesterday's close.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 154, putting it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Royal Dutch Shell PLC (RDS.A) - free report >>

Published in