U.S. Markets open in 7 hrs 52 mins

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

Zacks Equity Research

In the latest trading session, Shell Oil (RDS.A) closed at $58.77, marking a -0.09% move from the previous day. This change lagged the S&P 500's daily gain of 0.84%. Meanwhile, the Dow gained 0.92%, and the Nasdaq, a tech-heavy index, added 1.06%.

Heading into today, shares of the oil and gas company had gained 0.51% over the past month, lagging the Oils-Energy sector's gain of 3.63% and the S&P 500's gain of 3.95% in that time.

Wall Street will be looking for positivity from RDS.A as it approaches its next earnings report date. This is expected to be January 30, 2020. On that day, RDS.A is projected to report earnings of $0.88 per share, which would represent a year-over-year decline of 35.77%.

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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. The Zacks Consensus EPS estimate has moved 0.15% lower within the past month. RDS.A currently has a Zacks Rank of #3 (Hold).

Digging into valuation, RDS.A currently has a Forward P/E ratio of 11.57. For comparison, its industry has an average Forward P/E of 12.43, which means RDS.A is trading at a discount to the group.

We can also see that RDS.A currently has a PEG ratio of 2.31. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. RDS.A's industry had an average PEG ratio of 1.89 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 181, putting it in the bottom 30% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Royal Dutch Shell PLC (RDS.A) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research