Shell (SHEL) Outperforms Broader Market: What You Need to Know

In the latest close session, Shell (SHEL) was up +1.17% at $90.48. The stock outperformed the S&P 500, which registered a daily gain of 1.01%. On the other hand, the Dow registered a gain of 0.83%, and the technology-centric Nasdaq increased by 1.22%.

The oil and gas company's stock has climbed by 13.53% in the past month, exceeding the Oils-Energy sector's gain of 6.9% and the S&P 500's loss of 2.86%.

Analysts and investors alike will be keeping a close eye on the performance of Shell in its upcoming earnings disclosure. The company's upcoming EPS is projected at $1.86, signifying a 1.09% increase compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $69.15 billion, down 1.42% from the year-ago period.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $6.6 per share and revenue of $271.25 billion, indicating changes of +4.76% and -0.91%, respectively, compared to the previous year.

Investors should also take note of any recent adjustments to analyst estimates for Shell. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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 last 30 days, the Zacks Consensus EPS estimate has witnessed a 6.53% increase. At present, Shell boasts a Zacks Rank of #3 (Hold).

With respect to valuation, Shell is currently being traded at a Forward P/E ratio of 13.56. This valuation marks a premium compared to its industry average Forward P/E of 12.13.

One should further note that SHEL currently holds a PEG ratio of 6.19. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As the market closed yesterday, the Oil and Gas - Integrated - International industry was having an average PEG ratio of 1.1.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. At present, this industry carries a Zacks Industry Rank of 58, placing it within the top 24% of over 250 industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow SHEL in the coming trading sessions, be sure to utilize Zacks.com.

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Shell PLC Unsponsored ADR (SHEL): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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