Editing Shell plc
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|Beta | |Beta | ||
|1.21<ref>https://markets.ft.com/data/equities/tearsheet/summary?s=SHEL:LSE</ref> | | 1.21<ref>https://markets.ft.com/data/equities/tearsheet/summary?s=SHEL:LSE</ref> | ||
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|Market Rate of Return | |Market Rate of Return | ||
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|Shares Outstanding | |Shares Outstanding | ||
|7,345.31<ref name=":1">Shell annual report 2022 (pg.241) - https://reports.shell.com/annual-report/2022/_assets/downloads/shell-annual-report-2022.pdf</ref> | | 7,345.31<ref name=":1">Shell annual report 2022 (pg.241) - https://reports.shell.com/annual-report/2022/_assets/downloads/shell-annual-report-2022.pdf</ref> | ||
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|Share Price | |Share Price | ||
|30.28<ref>Share price in USD as of 04/07/2023.</ref> | | 30.28<ref>Share price in USD as of 04/07/2023.</ref> | ||
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| '''Equity''' | | '''Equity''' | ||
| '''222,416.06''' | | ''' 222,416.06''' | ||
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|Short Term Debt | |Short Term Debt | ||
|9,044.4 | | 9,044.4 | ||
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|Long Term Debt | |Long Term Debt | ||
|76,098.00 | | 76,098.00 | ||
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|Cash and Cash Equivalents | |Cash and Cash Equivalents | ||
|42,074.00 | | 42,074.00 | ||
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| '''Debt''' | | '''Debt''' | ||
| '''43,068.00''' | | ''' 43,068.00''' | ||
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|E/D+E | |E/D+E | ||
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The DCF valuation shows that Shell stock is undervalued, based on yearly revenue growth of 4.2%, and a terminal growth rate of 0%. The model reflects Shell managements targets of 6% free cash flow growth per year, as well as expected revenue of $4-5 billion in 2025. | The DCF valuation shows that Shell stock is undervalued, based on yearly revenue growth of 4.2%, and a terminal growth rate of 0%. The model reflects Shell managements targets of 6% free cash flow growth per year, as well as expected revenue of $4-5 billion in 2025. | ||
'''Shell Targets''' | '''Shell Targets:''' | ||
At the latest Shell capital markets day on the 14/06/2023, Shell CEO Wael Sawan announced that a minimum of $5 billion in share buy-backs would take place in the second half of the year, a strong sign that Shell management believes that their company is undervalued. The company aims to grow free cash flow by a minimum rate of 6% per year through to 2030. | At the latest Shell capital markets day on the 14/06/2023, Shell CEO Wael Sawan announced that a minimum of $5 billion in share buy-backs would take place in the second half of the year, a strong sign that Shell management believes that their company is undervalued. The company aims to grow free cash flow by a minimum rate of 6% per year through to 2030. | ||
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Shell will have a break even price of $30 per barrel on projects coming online between 2023-2025, well below the forecast crude oil prices. | Shell will have a break even price of $30 per barrel on projects coming online between 2023-2025, well below the forecast crude oil prices. | ||
'''ESG Factors''' | '''ESG Factors:''' | ||
Liquefied Natural Gas (LNG) makes up a majority of Shell's gas portfolio, although a non-renewable source of energy, it produces 50% less carbon emissions than coal when used to produce electricity. Shell aims to phase out coal, and replace it with the lower carbon alternative, LNG. Shell also has targets to have net zero methane emissions by 2030, and to eliminate routine flaring by 2025, faster than the world bank's 2030 deadline. | Liquefied Natural Gas (LNG) makes up a majority of Shell's gas portfolio, although a non-renewable source of energy, it produces 50% less carbon emissions than coal when used to produce electricity. Shell aims to phase out coal, and replace it with the lower carbon alternative, LNG. Shell also has targets to have net zero methane emissions by 2030, and to eliminate routine flaring by 2025, faster than the world bank's 2030 deadline. |