May 11, 2023
Top 10 Stock Shell Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Shell – Top 10 Stock in AEX Index
Shell is listed as a top 10 stock on May 11, 2023 in the market index AEX because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° Rank of 62 (high 62% performer), Obermatt assesses an overall buy recommendation for Shell on May 11, 2023.
Snapshot: Obermatt Ranks
| Country | Netherlands |
| Industry | Oil & Gas Integrated |
| Index | AEX, FTSE All Shares, FTSE 100, FTSE 350, Low Emissions, Employee Focus EU, Diversity Europe, Human Rights |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° Assessment Shell Buy
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 63 |
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| GROWTH | ||||||||
| GROWTH | 44 |
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| SAFETY | ||||||||
| SAFETY | 70 |
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| SENTIMENT | ||||||||
| SENTIMENT | 25 |
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| 360° VIEW | ||||||||
| 360° VIEW | 62 |
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ANALYSIS: With an Obermatt 360° Rank of 62 (better than 62% compared with alternatives), overall professional sentiment and engagement for the stock Shell are above average. The 360° Rank is based on consolidating four consolidated indicators, with half the metrics below and half above average for Shell. The consolidated Value Rank has an attractive rank of 63, which means that the share price of Shell is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 63% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 70. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 25. Professional investors are more confident in 75% other stocks. The consolidated Growth Rank also has a low rank of 44, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 56 of its competitors have better growth. ...read more
RECOMMENDATION: With a 360° Rank of 62, Shell is better than 62% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 63), and the financing structure is on the safer side (Safety Rank of 70). However, sentiment in the professional investor community is below-average (Sentiment Rank of 25), as is the growth momentum for the company (Growth Rank of 44). While everybody wants to buy at low stock prices (good value), professionals’ skepticism may mean that the low price is justified. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Shell only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 25 (better than 25% compared with alternatives), overall professional sentiment and engagement for the stock Shell is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Shell. Analyst Opinions are at a rank of 62 (better than 62% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 35, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in Shell. The Professional Investors rank is also low at 10, meaning that professional investors hold less stock in this company than in 90% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 44, which means that the current professional news and professional social networks are critical of this company (more negative news than for 56% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 25 (less encouraging than 75% compared with investment alternatives), Shell has a reputation among professional investors that is below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: Shell Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 63 (better than 63% compared with alternatives), Shell shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Shell. Price-to-Sales has a value of 68 which means that the stock price compared with what market professionals expect for future sales is lower than 68% of comparable companies, indicating a good value for Shell's revenue size. The same is valid for expected Price-to-Profits, more favorable than 56% of alternatives, and it is also true for the Price-to-Book capital (also referred to as market-to-book ratio) with an Obermatt Price-to-Capital Rank of 52. Compared with other companies in the same industry, dividend yields of Shell are expected to be higher than 52% of all competitors (an Obermatt Dividend Yield rank of 52). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 63, is a BUY recommendation based on Shell's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Shell based on its detailed value metrics.
Growth Strategy: Shell Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 44 (better than 44% compared with alternatives), Shell shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Shell. Capital Growth has a rank of 60, which means that currently professionals expect the company to grow its invested capital more than 29% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 71 (above 71% of alternative investments). But Sales Growth has only a rank of 24, which means that, currently, professionals expect the company to grow less than 76% of its competitors, and Profit Growth is also low at a rank of 29. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 44, is a HOLD recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Shell, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Shell Debt Financing Safety above-average
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 62 |
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| REFINANCING | ||||||||
| REFINANCING | 50 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 70 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 70 |
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ANALYSIS: With an Obermatt Safety Rank of 70 (better than 70% compared with alternatives), the company Shell has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Shell is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for Shell. Leverage is at 62, meaning the company has a below-average debt-to-equity ratio. It has less debt than 62% of its competitors. Refinancing is at a rank of 50, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 50% of its competitors. Finally, Liquidity is also good at a rank of 70, which means that the company generates more profit to service its debt than 70% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 70 (better than 70% compared with alternatives), Shell has a financing structure that is safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: Shell Above-Average Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 63 |
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| GROWTH | ||||||||
| GROWTH | 44 |
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| SAFETY | ||||||||
| SAFETY | 70 |
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| COMBINED | ||||||||
| COMBINED | 74 |
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ANALYSIS: With an Obermatt Combined Rank of 74 (better than 74% compared with investment alternatives), Shell (Oil & Gas Integrated, Netherlands) shares have above-average financial characteristics compared with similar stocks. Shares of Shell are a good value (attractively priced) with a consolidated Obermatt Value Rank of 63 (better than 63% of alternatives), are safely financed (Safety Rank of 70, which means low debt burdens), but show below-average growth (Growth Rank of 44). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 74, is a buy recommendation based on Shell's financial characteristics. As the company Shell's key financial metrics exhibit good value (Obermatt Value Rank of 63) but low growth (Obermatt Growth Rank of 44) while being safely financed (Obermatt Safety Rank of 70), it may be a safer investment because companies with low debt can better withstand times of crises. The good value, better than 63% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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