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

Bank of America downgraded Royal Dutch Shell PLC RDS 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.