NEW YORK (TheStreet) -- Shares of Royal Dutch Shell (RDS.A) are up 0.86% to $79.69 after the company sold two gas assets in Wyoming and Louisianan for $2.1 billion, plus additional shale acreage in Pennsylvania.
Shell CEO Ben Van Beurden, who took over from Peter Voser at the start of the year, is accelerating asset disposals to win investor support, according to Bloomberg.
He returned Shell’s operations to profit in the Americas this year, where the company has about $61 billion deployed in onshore tight and shale gas and oil projects, Bloomberg reports.
TheStreet Ratings team rates ROYAL DUTCH SHELL PLC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate ROYAL DUTCH SHELL PLC (RDS.A) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 211.11% and other important driving factors, this stock has surged by 25.67% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, RDS.A should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 205.5% when compared to the same quarter one year prior, rising from $1,737.00 million to $5,307.00 million.
- RDS.A's debt-to-equity ratio is very low at 0.24 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.85 is somewhat weak and could be cause for future problems.
- ROYAL DUTCH SHELL PLC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ROYAL DUTCH SHELL PLC reported lower earnings of $5.18 versus $8.52 in the prior year. This year, the market expects an improvement in earnings ($15.03 versus $5.18).
- You can view the full analysis from the report here: RDS.A Ratings Report
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