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How Do Shareholders View Shell's (SHEL) Climate Goals?

At its Annual General Meeting in London, Shell plc SHEL shareholders voted in favor of the company’s energy transition strategy but in lower numbers. The supermajor, which has set itself a target of becoming a net-zero greenhouse gas emissions business by 2050, received 80% support for its climate policy, down from 89% in 2021 when the plan was first unveiled.

At the same time, a resolution filed by activist group Follow This, which demands the company's targets to be more stringent and in line with the Paris Agreement, got 20% votes — a sharp decrease from last year, when a similar motion won 30% support. As per the investor advocacy group, Shell’s intermediate targets are linked to emissions’ intensity that might actually allow the firm to advance its fossil fuel output.   

Shell, like its peers, is under increasing pressure from activists and investors surrounding climate change and the commitment to reduce emissions. Holding management publicly accountable for their lack of progress on meeting targets to cut emissions, this year’s annual meeting was disrupted by climate activists for almost three hours, with campaigners chanting and shouting against the company’s continued exploration for oil and natural gas.

Even last week, investment fund and Shell stakeholder Odey Asset Management called on Europe’s largest oil company to retract its appeal against a landmark 2021 Dutch court ruling to cut its emissions quicker and lower its absolute emissions by 45% by 2030. Meanwhile, Shell is sticking to its mid-century net-zero target.

According to the London-based multinational, it has lowered emissions from operations by 18% between 2016 and 2021, with a pledge to extend it to 50% by 2030. Shell also claims to have reduced the net carbon intensity of its marketable product portfolio by 2.5% by the end of 2021 compared with 2016, ultimately targeting a 9-12% reduction by 2024.

Shell is one of the primary oil supermajors — a group of U.S. and Europe-based big energy multinationals with operations that span almost every corner of the globe. The company is fully integrated, meaning it participates in every aspect related to energy – from oil production to refining and marketing.

Zacks Rank & Key Picks

Shell currently carries a Zacks Rank #3 (Hold).

Some better-ranked players in the energy space include Equinor ASA EQNR, Canadian Natural Resources CNQ and Marathon Oil MRO. each carrying a Zacks Rank #1 (Strong Buy), currently.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Equinor: Equinor is valued at some $120 billion. The Zacks Consensus Estimate for EQNR’s 2022 earnings has been revised 51.9% upward over the past 60 days.

Equinor, headquartered in Stavanger, Norway, delivered a 1.9% beat in Q1. EQNR shares have surged around 74.5% in a year.

Canadian Natural Resources: CNQ beat the Zacks Consensus Estimate for earnings in each of the last four quarters. The company has a trailing four-quarter earnings surprise of roughly 17.6%, on average.

Canadian Natural is valued at around $75.1 billion. CNQ has seen its shares gain around 95.2% in a year.

Marathon Oil: Marathon Oil is valued at some $20.5 billion. The Zacks Consensus Estimate for MRO’s 2022 earnings has been revised 52.9% upward over the past 60 days.

Marathon Oil, headquartered in Houston, TX, has a trailing four-quarter earnings surprise of roughly 23%, on average. MRO shares have gained around 151.3% in a year.


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Shell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report
 
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