Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
Short Shots is a collection of technically vulnerable charts culled from the Negative Inflecting and Toppy columns within our Weekly Compass report or from various technical screening processes. The charts contained in this report have developed concerning technical patterns that suggest further price deterioration is likely. For these reasons Short Shots can also be a great source of ideas for investors interested in short-selling candidates.
With its management day on Tuesday, narrow-moat Shell extended its outlook through 2025 from the existing plan that runs through 2020. The latest plan calls for organic free cash flow of $35 billion in 2025 from a range of $28 billion-$33 billion in 2020, with returns on capital rising to 12% from 10%, and gearing falling to 15%-25% from 25%. Cash capital expenditures should tick up to $30 million on average (including about $1 billion in acquisition spending) from $24 billion->$29 billion expec...
With its management day on Tuesday, narrow-moat Shell extended its outlook through 2025 from the existing plan that runs through 2020. The latest plan calls for organic free cash flow of $35 billion in 2025 from a range of $28 billion-$33 billion in 2020, with returns on capital rising to 12% from 10%, and gearing falling to 15%-25% from 25%. Cash capital expenditures should tick up to $30 million on average (including about $1 billion in acquisition spending) from $24 billion->$29 billion ex...
With the restoration of its cash dividend, Shell has demonstrated that it has taken the necessary steps to remain competitive in a world of $60/barrel oil. Like the rest of the integrated group, Shell has reduced its cost base, which had become bloated, in part by reducing headcount and improving its supply chain. Furthermore, the addition of BG’s low-cost production reduces Shell’s per-barrel operating cost, which ranked among the highest in its peer group. Shell already reduced operating c...
Best Idea Royal Dutch Shell posted an impressive first quarter with earnings growth across all operating segments and continued strong cash flow generation. The quarter stands out from other integrateds’ relatively weak reports and demonstrates the value of Shell’s integrated model while supporting our thesis of continued earnings and free cash flow growth during the next several years. As such, our fair value estimate and moat rating are unchanged. We continue to think this improvement is u...
Best Idea Royal Dutch Shell posted an impressive first quarter with earnings growth across all of operating segments and continued strong cash flow generation. The quarter stands out from other integrateds’ relatively weak reports and demonstrates the value of Shell’s integrated model while supporting our thesis of continued earnings and free cash flow growth during the next several years. As such, our fair value estimate and moat rating are unchanged. We continued to think this improvement ...
Best Idea Royal Dutch Shell posted an impressive first quarter with earnings growth across all of operating segments and continued strong cash flow generation. The quarter stands out from other integrateds’ relatively weak reports and demonstrates the value of Shell’s integrated model while supporting our thesis of continued earnings and free cash flow growth during the next several years. As such, our fair value estimate and moat rating are unchanged. We continued to think this improvement ...
Shell closed out 2018 by reporting better-than-expected fourth-quarter results, including strong earnings and cash flow growth. Most notable was the cash flow, which increased to $22.0 billion from $7.3 billion a year ago. Shell’s cash flow generation has been plagued all year by increases in working capital and margin requirements for hedging contracts for the integrated gas portfolio, but both turned to a tailwind during the fourth quarter, to the tune of $9.1 billion and $1.9 billion, respe...
Shell closed out 2018 by reporting better-than-expected fourth-quarter results, including strong earnings and cash flow growth. Most notable was the cash flow, which increased to $22.0 billion from $7.3 billion a year ago. Shell’s cash flow generation has been plagued all year by increases in working capital and margin requirements for hedging contracts for the integrated gas portfolio, but both turned to a tailwind during the fourth quarter, to the tune of $9.1 billion and $1.9 billion, respe...
Amara's law states that we tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run. We'd posit that is the case today with ride-hailing, electric vehicles, and autonomous vehicles, and their impact on private vehicle ownership and fuel consumption. Our analysis suggests these technologies will be beneficial for mobility, but the net impact on U.S. gasoline demand will be negative. Specifically, we think the introduction of AVs will materially...
Consensus is missing the boat on China’s medium- and long-term oil demand but, interestingly, in different directions. Over the next five years, we’re bullish. We think that by relying on China’s inflated official GDP growth figures, other forecasters are underestimating China’s income elasticity of oil demand. Looking from the bottom up, near-term improvements in China's fuel-efficiency standards will be more modest than headline requirements suggest. Also, others have mistakenly identi...
Consensus is missing the boat on China’s medium- and long-term oil demand but, interestingly, in different directions. Over the next five years, we’re bullish. We think that by relying on China’s inflated official GDP growth figures, other forecasters are underestimating China’s income elasticity of oil demand. Looking from the bottom up, near-term improvements in China's fuel-efficiency standards will be more modest than headline requirements suggest. Also, others have mistakenly identi...
Shell reported a stand out quarter that demonstrates the firms’ potential cash flow generation. Operating cash flow increased 59% to $12.1 billion from $7.6 billion the year before on a 38% increase in earnings. Shell has been plagued in recent quarters by one-off items that negatively impacted its cash flow generation and left the market disappointed, but this quarter provides a truer picture of its potential in our view and supports our thesis for growing long-term free cash flow. That said,...
Shell reported a stand out quarter that demonstrates the firms’ potential cash flow generation. Operating cash flow increased 59% to $12.1 billion from $7.6 billion the year before on a 38% increase in earnings. Shell has been plagued in recent quarters by one-off items that negatively impacted its cash flow generation and left the market disappointed, but this quarter provides a truer picture of its potential in our view and supports our thesis for growing long-term free cash flow. That said,...
Integrated oils are set to reverse years of little or no free cash flow despite significantly lower oil and gas prices as high levels of investment give way to growth and capital restraint. We expect increased free cash flow from both upstream and downstream segments. In upstream segments, improved cost structures and the addition of higher-margin production will increase cash margins, offsetting much of the impact of lower oil prices. Meanwhile, service cost deflation, standardization, and simp...
Integrated oils are set to reverse years of little or no free cash flow despite significantly lower oil and gas prices as high levels of investment give way to growth and capital restraint. We expect increased free cash flow from both upstream and downstream segments. In upstream segments, improved cost structures and the addition of higher-margin production will increase cash margins, offsetting much of the impact of lower oil prices. Meanwhile, service cost deflation, standardization, and simp...
Integrated oils are set to reverse years of little or no free cash flow despite significantly lower oil and gas prices as high levels of investment give way to growth and capital restraint. We expect increased free cash flow from both upstream and downstream segments. In upstream segments, improved cost structures and the addition of higher-margin production will increase cash margins, offsetting much of the impact of lower oil prices. Meanwhile, service cost deflation, standardization, and simp...
Best Idea Shell’s second-quarter earnings report proved to be somewhat disappointing, as higher oil prices did not translate into the increase in earnings and cash flow the market was expecting despite reporting strong year-over-year increases. Though the results were received negatively by the market, we do not see them as indicative of future potential. Our fair value estimate and no-moat rating remain unchanged, leaving Shell as one of the most undervalued integrateds. Adjusted earnings for...
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