Jefferies remains bullish on Royal Dutch Shell (LON:RDSA), arguing that the group’s restructuring is leaving it well positioned for the medium-term, Citywire reports. The comments came after the company updated investors on its full-year performance last month.
Shell’s share price was little changed in the previous session, shedding 0.07 percent to close at 2,301.00p, outperforming the broader UK market, with the benchmark FTSE 100 index losing 50.54 points to end the session 0.69 percent lower at 7,231.91, pressured by a selloff in miners. The group’s shares have added more than 10 percent to their value over the past year, as compared with about a 0.4-percent dip in the Footsie.
Jefferies sees Shell as ‘buy’
Jefferies reiterated its ‘buy’ rating on Shell yesterday, lifting its price target on the stock from 2,890p to 3,180p.
“The restructuring of the Shell portfolio leaves it well positioned for the medium term,” the broker’s analyst Jason Gammel commented, as quoted by Citywire. “In the near term, the driver of the stock will be delivery of the well-defined financial targets from each of Shell’s businesses.”
The analyst pointed out that the Anglo-Dutch oil major also offered “compelling opportunity for long-term investors,” with “one of the most sustainable business models in the sector, capable of fully funding the dividend with free cashflow when oil prices are at the bottom of the cycle but also generating strong free cashflow in a moderate oil price environment”.
Other analysts on oil major
Barclays also remains upbeat on the shares, having reiterated its ‘overweight’ stance on Shell this week, with a price target of 3,000p, while Credit Suisse continues to see the company as an ‘outperform,’ valuing the shares at 2,725p. According to MarketBeat, the Anglo-Dutch oil major currently has a consensus ‘buy’ rating and an average price target of 2,636.36p.