Like other oil and gas majors with operations in the Gulf of Mexico, Royal Dutch Shell‘s (RDSB) operations were damaged by Hurricane Ida at the end of August. However, the hit to the oil industry that Ida caused has pushed the price of oil to a recent high, contributing to a more than 5% spike in Shell stock’s price since Friday. On Tuesday, the Relative Strength (RS) Rating for Shell stock jumped to 84, up from 79 the day before.
The 84 RS Rating means that Shell stock has outperformed 84% of all stocks on price performance over the past year. It’s a significant rating bump because research shows that the best stocks typically have an RS Rating north of 80 as they begin their biggest climbs.
Shell Stock Pops Despite Down Market
Shell stock rose Tuesday, a day after reports that the company’s Shell Energy business in the U.K. essentially gained 255,000 natural gas customers after rival Green Supplier Limited defaulted. Netherlands-based oil and gas giant Shell traded at 44.10 Tuesday afternoon, even as the overall market slumped, up 0.7% for the day and up about 5.5% over the past two days.
Among other key ratings, Shell stock has a strong 84 Composite Rating.
IBD’s Composite Rating combines five separate proprietary ratings of fundamental and technical performance into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
However, its EPS Rating is a so-so 65, of 99, reflecting weak earnings results last year during the early phases of the pandemic.
Taking a look at revenue and profit performance this year, though, shows the company has posted two quarters of rising earnings growth. Revenue growth has also increased during the same period. Last quarter, Shell reported a 788% year-over-year surge in EPS to $1.42. Revenue for the quarter climbed 86% to $60.5 billion.
Peers In Oil & Gas Group
Shell stock is now considered extended and out of buy range after clearing a 42.39 buy point in a first-stage consolidation. See if the stock forms a new pattern or follow-on buying opportunity like a three-weeks tight or pullback to the 50-day or 10-week line.
When looking for the best stocks to buy and watch, keep a close on eye on relative price strength.
IBD’s proprietary Relative Strength Rating measures price action with a 1 (worst) to 99 (best) score. The grade shows how a stock’s price performance over the last 52 weeks stacks up against all the other stocks in our database.
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