London, Jan 26, 2026, 07:49 GMT — Premarket
- RBC downgraded Shell from “outperform” to “sector perform” and lowered its price target to 3,200p
- On Friday, Shell shares finished at 2,687.5p, marking a 0.5% rise.
- Traders enter the week focused on oil prices alongside Shell’s February 5 earnings and dividend announcement
Shares of Shell Plc caught attention before Monday’s London open after RBC Capital Markets downgraded the stock to “sector perform,” slashing its price target from 3,600 pence to 3,200 pence. RBC described Shell’s chemicals restructuring as “running uphill” and raised concerns about its portfolio, warning of a downside risk to 1,500 pence. (Investing)
Shell is set to release its fourth-quarter results and announce an interim dividend on Feb. 5. CEO Wael Sawan and CFO Sinead Gorman will hold an analyst webcast later that day. (Shell)
Shell closed Friday up 0.5% at 2,687.5 pence, per Hargreaves Lansdown. The shares offered a dividend yield around 4%, with a price-to-earnings ratio close to 9.8. (Hargreaves Lansdown)
Oil prices edged higher early on, with Brent crude climbing 0.7% to $66.30 a barrel by 0721 GMT. Harsh winter weather has hit U.S. output, while tensions around Iran added a persistent risk premium. “President Trump’s declaration of a U.S. armada sailing toward Iran has reignited supply-disruption fears,” said IG market analyst Tony Sycamore. (Reuters)
Shell has already flagged a rough patch in its downstream operations. In a Jan. 8 trading update, the company revealed its chemicals and products segment is expected to report a fourth-quarter loss, partly due to oil trading results that were “significantly lower” than in Q3. This has put renewed focus on its hefty $3.5 billion quarterly share buyback. RBC analyst Biraj Borkhataria questioned whether management would “hold the line on the buyback,” while HSBC’s Kim Fustier expressed he was “less confident” the current pace could continue. (Reuters)
That’s why this broker downgrade stings more than usual. Investors are running out of tolerance for another quarter weighed down by chemicals and unpredictable trading results.
RBC’s mention of “portfolio concerns” points directly to what the market has been buzzing about for months: deals. When banks refer to “inorganic activity,” they typically mean acquiring or offloading assets, rather than wringing more value from existing holdings.
Shell has positioned itself as a reliable cash generator, counting on steady LNG growth and stable liquids output. The question ahead of earnings is whether that narrative can hold up when the weaker areas come into focus simultaneously.
The path isn’t set in stone. A drop in crude prices or another weak quarter from trading and chemicals would swiftly shift attention back to cash flow and raise questions about whether shareholder returns might ease up.
The next major event arrives on Feb. 5, when Shell releases its report and declares its interim dividend. The 14:30 GMT webcast will draw nearly as much attention as the earnings themselves.
