#1 - Royal Dutch Shell (NYSE:RDS.A)
Royal Dutch Shell (NYSE: RDS-A) - One strategy for investing in rising oil and gas stocks is to look at the major players. Due to their large market caps, an increase in oil prices increases their valuation. For example, if Brent crude were to increase to $90/barrel by 2020, as at least one industry analyst believes it will, a company like RDS would see its valuation increase by 30%, and one analyst is predicting the stock could see a 25% increase in 2018. Oil and gas companies can get highly leveraged when oil prices decline, so rising prices will provide an increase in free cash flow that will help their balance sheet and help reduce investor concerns about the company’s debt load. Rising prices are also seen as a positive sign for dividend growth. RDS currently has a dividend yield of over 5.5%, well above the industry average of around 4.8%. Another reason to consider a major player like RDS is its pipeline of new projects that will also help their cash flow. And while consumers don’t like the higher prices, gas is one of those commodities that consumers will still purchase and RDS has one of the largest networks of retail gas stations.
About Royal Dutch Shell
Royal Dutch Shell plc operates as an energy and petrochemical company worldwide. The company operates through Integrated Gas, Upstream, Oil Products, Chemicals segments. It explores for and extracts crude oil, natural gas, and natural gas liquids; markets and transports oil and gas; produces gas-to-liquids fuels and other products; and operates upstream and midstream infrastructure necessary to deliver gas to market.
Read More - Current Price
- $51.04
- Consensus Rating
- N/A
- Ratings Breakdown
- 0 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- N/A
