Member Info for Bimmer668

Are the share buybacks holding up the share price?

Recent article in Washington Post :-

Oil Is in Another Bear Market - and for Good Reason

https://www.washingtonpost.com/business/energy/oil-is-in-another-bear-market---and-for-good-reason/2022/06/22/1a11fcaa-f26f-11ec-ac16-8fbf7194cd78_story.html

Will my prediction of oil at USD140 and Shell at £28 in 12 months still happen?

Was £24.59 the peak?

Only time will tell.

Oil at 120 gave us SP at above £24
If oil breaches 140, mathematically SP should be £28.

I’d be happy if it hits £26, sometime this year.

That’s not very far for the recent 52 week high of 2459, until the markets got spooked by the talk of recession this year.

Luckily its no longer falling like a stone. At least not for now. It may even recover above 21 today.

The prefect trade would have probably been sell at 24.50, buy back at 20.50 for a 4 pound "profit" within a week.

I was even thinking of adding some shares to round up my position if it went below 20 with my dividend money this quarter as I opted for cash instead of shares this time.

Anyway, hopefully the strength in the SP continues for now.

Oil at USD120 gave Shell a share price of £24.

Could oil breach its all time high of USD147 in July 2008?

If so, could Shell share price hit £30?

That’s about a 25% upside from where we are now.

If at all, it would have to be this year but ATH oil prices would surely force the world into a global recession.

That may very well cause a 2008 like oil price collapse after hitting ATH of USD147.

So we probably should be careful what we wish for.

Whatever happens, the next half year is certainly going to interesting to watch.

I am also keeping an eye on US markets, the equivalent of 24 pounds is about USD60 for the US listed stock.

I dont think is 1:1, more like 1:2 ?

Yes, Jim. Hopefully it bounces back up soon to above 24.

My 12 month prediction for Shell share price:-

High - 32
Median - 28
Low - 24

CNN Money's Stock Price Forecast based on Analyst 12 month price forecasts:-
https://money.cnn.com/quote/forecast/forecast.html?symb=SHEL

The High in CNN's forecasts is another 55% from current prices which is about 37 pounds.

Even if we take 50% , that would bring us to 36 pounds.

So maybe it could even be 24 vs 30 vs 36?

Its anyone's guess but it's really hard to justify selling at 24 pounds now when there could be another 20% to 50% upside in this stock.

Jim800, agreed. We will be lucky if it stays up above 23 pounds today but I think we should get back to 24 pounds soon.

It will be interesting to see whether we will hit 28 pounds or even 32 pounds within the next 12 months.

For now, I am not selling yet but as the price continues to rise, its really hard to not give in to the temptation to realise some profits.

But I definitely wont be selling at anything below 24 pounds. If it continues to go up, I may hold on for 26 or even 28 pounds.

Whilst I acknowledge that target price by analyst cannot be trusted, it doesn't stop us from looking at it , like glazing into a crystal ball.

CNN has a summary of such target prices for Shell. See https://money.cnn.com/quote/forecast/forecast.html?symb=SHEL

Based on the same it has a Low of USD60 ( or about 24 pounds) which is the current price level on the US stock echange and in London.

Median of USD69.50 or about 27.80 pounds or say 28 pounds

High of USD82 or USD32.80 or say 32 pounds.

The above are not based on exchange rates but based on the projected price of the shares based on current level.

Mot sure if my calculation is correct but based on it , the current 24 pounds could be the base price for the next 12 months with a potential median of 28 pounds and a high of 32 pounds.

It would therefore be hard to sell at current price levels but of course a lot could happen in 12 months.

If the SP jumps back above 24 pounds soon, it would be a good sign, I think.

My transaction costs ie stamp duty, brokerage etc is about 1.3%. So to trade ie sell now and buy later works out to about 2.6%. Tried to time the market before and lost out. So for now I’m holding on to my 3000+ shares in Shell. It still feels like it has legs to run and if the dividends go back to pre-pandemic levels, it could even go higher. £30 may be possible, so I guess I’ll hold on for now. If you decide to sell , then just walk away. Don’t try to trade it at these levels, may not be worth the transaction costs.

Yes, 25 looks tempting. I guess I'll wait too

Looks like 24 today is possible.

26 + Dividend. Sounds good to me. So the target now is 26 before the next quarterly results. Based on present momentum, looks possible.

I maent growth stocks.

Best case scenario is that some of the money flowing out of growth stops and Faang find their way into big oil, including Shell and keep this energy stocks rally going. Still hoping for 25 pounds sooner than later.

I may have spoken too early. Market spoked today. Shell may drop £1 from its 52 week high of 2334.50 today. Hopefully it recovers later this week.

I read somewhere that oil prices had been above USD100 per barrel between 2011 to 1H 2014 but halved in 2H2014.
I wonder how long it will stay above USD100 this time.

Just Google it and found this:-

"After peaking at $107.95 a barrel on June 20, 2014, petroleum prices plunged to $44.08 a barrel by January 28, 2015, a drop of 59.2 percent in a little over 7 months."

Washington Posts had this to say in 2014:-

'The law of supply and demand did it. The price collapse mainly reflects too much supply chasing too little demand. Most analysts have focused on surging U.S. production of “shale” oil, which has increased by 3.5 million barrels a day (mbd) since 2008, according to the consultancy IHS. But the U.S. expansion was widely anticipated, says economist Larry Goldstein. The real surprise, he argues, was lower-than-expected global demand. In early 2014, forecasters predicted growth of 1.3 mbd, says Goldstein. Actual growth is about half that, 700,000 mbd, reflecting unpredicted economic weakness in Europe, Japan and China.'

I don't see supply going up any time soon but demand may fall if the major economies go into recession.

2022 will cerainly be an interesting year for Shell and Oil.

Having hit 23 pounds this week , I am now looking forward to 25 pounds soon. The money moving out of tech and other sectors has to go somewhere and it seems a lot is moving into Oil and Gas.

I started buying Shell about 2 years ago and what a ride it has been. It may still have some more legs to run so I am still hanging in here.

Based on the momentum that this stock has, could we see £25 this year.

I am confident it will breach £23 soon, but is £25 expecting too much?