Royal Dutch Shell B share price is up by more than 1.60% as part of the overall rally in global stocks. The shares are trading at 976p, which is higher than last month’s low of 976p. At the same time, Shell A shares are up by just 0.67% and are trading at 1,015p.
Royal Dutch Shell has gone through a series of positive news recently. A few days ago, the big oil company released relatively strong quarterly earnings that beat consensus estimates. The company made a profit of $955 million in Q3 after making losses in the previous three quarters. That pushed the management to raise dividends by 4%.
At the same time, the company attracted new bulls in Wall Street. Jason Gabelman and George Kuhle, analysts from Cowen, upgraded the stock to outperform. They pointed that the company had proven itself better positioned to weather the current storm than its peers.
Morgan Stanley, Barclays, UBS, and Goldman Sachs have also recently boosted their target for Shell share price. Those at Goldman expect the stock to rise to 1,740p while those at Morgan Stanley expect it to rise to 1,550p. In total, the average target for Shell B shares is 1,738p, which is a 77% increase from the current price.
Investors are also optimistic about Shell’s management plan to transition the company from being a major seller of crude oil to a low-carbon company. It has done that by launching a new energies business that is focusing on solar and wind to generate electricity. Still, it is relatively early to predict whether the firm will be successful in this.
The recent good news comes after a challenging period for Shell. The company has suffered as the crude oil price has dropped by more than 40% this year. The rising number of Covid-19 cases has also led many to believe that the demand for crude oil will continue to wane. Shell has also announced a $17 billion write-off of its business and more than 9,000 job cuts worldwide.
The four-hour chart shows that Royal Dutch Shell B share price has been in a downward trend for months. That saw it form a descending channel that is shown in green. Last week, the price managed to rise above the upper side of the channel. It is also above the 15-day and 25-day exponential moving averages. It has also found strong resistance at 1,000p.
Therefore, I suspect that the upward trend will continue as bulls aim for the next resistance at 1,100p. On the flip side, a move back to the descending channel will invalidate this trend.
