Erste Group upgraded Shell Plc. to Buy from Hold on Wednesday, citing the company’s strong refining margins and integrated value chain as key differentiators in a tight product market.
Analyst Hans Engel highlighted Shell’s disproportionate benefit from high margins on diesel, gasoline and kerosene, with refining capacity operating at full capacity. The upgrade follows a Pro Research Report published via InvestingPro.
Shell’s stock, trading at $90.47, was viewed as undervalued based on a price-to-earnings ratio of 10.03, which remains below peers. The company also reported a Piotroski Score of 9, indicating robust financial health, and a dividend yield of 3.43%. Year-to-date, the shares have gained 27%.
Second-quarter 2026 results showed revenue of $94.66 billion, exceeding the $86.80 billion forecast, though earnings per share came in at $1.76 compared with the expected $2.80. Operating cash flow surpassed $21 billion, while free cash flow reached approximately $17 billion. Net debt declined to about $42 billion.
For 2026, Shell maintained cash capital expenditure guidance of $24 billion to $26 billion and announced planned share buybacks of $3 billion.
In related trading activity, Shell and Equinor sold two WTI Midland crude cargoes to Total in the Platts window. Shell’s cargo is scheduled for delivery between August 30 and September 3, while Equinor’s window runs from August 24 to August 28. Both transactions were executed at differentials to dated Brent.
