Lates News

date
04/08/2025
HSBC Bank downgraded Shell's rating from "buy" to "hold" on Monday, stating that the oil giant's investor payout before the end of the decade cannot be supported by internal funds and its valuation premium relative to European peers has become "too high". HSBC Bank noted that although Shell has a "robust" financial framework, its net debt may rise in the foreseeable future. This could impact market perceptions of the sustainability of its dividends, similar to what happened with BP and TotalEnergies. The normalization of the oil and gas trading environment is affecting Shell's earnings. Shell faces greater risks compared to its industry peers as it relies more heavily on trading income. The valuation premium of Shell relative to its major European competitor TotalEnergies is no longer reasonable. Shell's stock price fell 0.6% on Monday to 2692 pence. HSBC Bank raised its target price from 2900 pence to 2950 pence.