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UPDATE: Bank of America Downgrades Royal Dutch Shell PLC to Underperform on Capex, Cost Concerns

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Bank of America downgraded Royal Dutch Shell PLC (NYSE: RDS-A) from Neutral to Underperform.

Bank of America noted, "Our cautious view stems from concerns that Shell's underlying costs and capex are set to rise more aggressively than the market currently believes. Ultimately we see this weighing on returns, earnings momentum and distributable cash flows in the medium term, underpinning our view the shares could face a de-rating. Whilst we remain fully confident in Shell's ability to pay its dividend, we see its 21% premium to European big oil on 2014E EV/DACF as unsustainable as returns and free cash flow deteriorate."

Royal Dutch Shell closed at $72.72 on Thursday.

Latest Ratings for RDS-A

Dec 2014Deutsche BankDowngradesBuyHold
Nov 2014
Jul 2014NomuraUpgradesNeutralBuy

View More Analyst Ratings for RDS-A
View the Latest Analyst Ratings

Posted-In: Bank of AmericaAnalyst Color Downgrades Analyst Ratings


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