Charles Stanley upgrades Shell to 'buy' despite oil-price fall

Broker Charles Stanley has lifted its recommendation for Royal Dutch Shell from 'accumulate' to 'buy', saying that the company should be resilient to the recent slump in oil prices.The broker said Shell was "well-placed to improve its returns and deliver its objectives" over the medium term in spite of crude's current volatility."The 5.1% dividend yield is attractive and the combination of a more competitive performance and a strong pipeline of new projects continue to make Shell a top pick in the sector," said analyst Tony Shepard.Shell said on Thursday that adjusted earnings on a current cost of supplies rose 31% year-on-year to $5.8bn in the third quarter.This was much higher than the $5.5bn expected by analysts, though Shepard pointed out that the comparative with last year was "exceptionally weak".Meanwhile, current oil prices are now 16% lower than they were in the third quarter and are expected to "remain depressed in 2015", the analyst said.Nevertheless, he said: "These new macro conditions may suit the integrated oil companies. Already inflationary cost pressures are easing and the super-majors have extensive downstream operations which benefit from lower prices," he said.Shell's shares have fallen 11% since the Brent oil price peaked at $115 per barrel in June 2014. This, Shepard highlighted, was a strong relative sector outperformance, with peers like BG having dropped 15%.The stock was down 1.7% at 2,197p by 11:08.