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Highlights

  • Shell earns multiple Buy ratings with a price target of GBP 3,199.68, indicating a 21.61% upside.

  • Q1 2025 adjusted earnings stood at $5.6 billion, with $11.9 billion in CFFO excluding working capital.

  • Recent acquisition in Nigeria boosts Shell’s stake in key offshore asset OML 118 to 67.5%.

Shell plc (LSE:SHEL), one of the world's largest integrated energy companies, continues to draw positive investor sentiment with analysts maintaining Buy recommendations and assigning a target price of GBP 3,199.68, implying a 21.61% upside from the current market price of GBP 2,631.0. The bullish outlook stems from Shell's recent Q1 2025 performance, disciplined capital allocation, and a series of strategic moves aimed at enhancing long-term portfolio.

Several prominent institutions, including HSBC, Intesa Sanpaolo, TD Cowen, and Rothschild & Co Redburn, have issued Buy ratings on Shell. Intesa Sanpaolo leads with a target price of GBP 3,281, representing a 24.71% potential upside, while other analysts like HSBC and TD Cowen offer targets of GBP 2,930 and GBP 2,890, respectively. Even with a neutral stance, ODDO BHF has set a higher-than-current target of GBP 2,800.

Backing this confidence is Shell’s Q1 2025 adjusted earnings of $5.6 billion. Cash flow from operations (CFFO), excluding working capital movements, came in at $11.9 billion, reflecting performance in both upstream and trading divisions. Despite a $2.7 billion outflow in working capital, Shell maintained healthy financial positioning and operational discipline.

A cornerstone of Shell’s strategy has been portfolio optimisation, as evidenced by the completion of divestments of non-core assets including the Singapore Energy and Chemicals Park and SPDC in Nigeria. Simultaneously, Shell expanded its footprint in the liquefied natural gas (LNG) space with the Pavilion Energy acquisition.

In a strategic deal announced on 29 May 2025, Shell’s Nigerian subsidiary SNEPCo signed an agreement to acquire an additional 12.5% stake in the OML 118 Production Sharing Contract, which includes the high-producing Bonga field. This transaction increases Shell’s interest in the offshore block from 55% to 67.5%.

Looking ahead, Shell forecasts Q2 2025 production in the range of 1,560 – 1,760 thousand barrels of oil equivalent per day (kboe/d), a slight decline from 1,855 kboe/d in Q1, likely reflecting seasonal or portfolio transition impacts. However, the company remains focused on balancing shareholder returns and reinvestment, maintaining a 2025 cash capex guidance of $20–22 billion.