Shell shares rise 3.7% after HSBC raises its rating, citing improved cash flow and growth visibility from a $16.4B deal.
Shell (SHEL) climbed 3.7% in Monday trading after HSBC upgraded the stock to Buy from Hold. The upgrade reflects higher cash flow estimates and better medium-term upstream growth visibility following Shell’s $16.4B acquisition of ARC Resources.
Prior to the upgrade, Shell had been rated Hold by HSBC, with analysts citing stable but unremarkable cash flow projections. The ARC Resources deal, announced earlier this month, has shifted sentiment by expanding Shell’s resource base and strengthening its position in key production regions.
Repsol was also upgraded to Buy, though its share price reaction was not detailed in the report.