A portfolio of stocks I've been building since September 3 is named Volio Folio. It will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!
Today I'm reviewing the first of five energy stocks striving to be picked to join the Volio folio. This could be the eleventh pick for Volio!
That real estate sector includes six industries all related to bringing oil and gas to the market. They are: drilling, exploration and production (E&P), equipment and services, integrated, midstream, refining & marketing. (Yes, those are the six oily and gassy enterprises.)
My subject today is a large-cap oil & gas integrated company named, Royal Dutch Shell PLC. Their trading ticker symbol is RDS-A. This is my first report on Royal Dutch Shell PLC.
Royal Dutch Shell is an integrated oil and gas company that explores for, produces, and refines oil around the world.
In 2018, it produced 1.9 million barrels of liquids and 11.2 billion cubic feet of natural gas per day. At year-end 2018, reserves stood at 11.4 billion barrels of oil equivalent (including 1.3 billion for equity companies), 37% of which consisted of liquids. Its production and reserves are in Europe, Asia, Oceania, Africa, and North and South America.
The company operates refineries with a capacity of 2.9 mmbd located in the Americas, Asia, Africa, and Europe and sells 18 mtpa of chemicals. Its largest chemical plants, often integrated with its local refineries, are in Central Europe, China, Singapore, and North America.
Royal Dutch Shell plc was founded in 1907 and is headquartered in The Hague, the Netherlands.
I use three key data points to gauge dividend-paying equities or funds like Royal Dutch Shell PLC:
(1) Price
(2) Dividends
(3) Returns
Besides those three, several other keys will finally unlock an equity or fund in which to invest, or not.
Those three basic keys, however, best tell whether a company has made, is making, and will make money.
RDS.A Price
Shell's price per share closed at $60.25 on Friday. A year ago its price was $62.16. In the past year, its price fell $1.91 or 3%.
Assuming Shell's stock trades in a range of $50 to $80 this next year, it's recent $62.25. price could rise by $14.75 and might get to $75.00 by mid-November, 2020, assuming more upward price momentum continues.
RDS.A Dividends
Shell's latest declared quarterly dividend was $0.94, payable December 18th.
That $0.94 Q dividend was last raised from $0.90 in June 2014 and equates to $3.76 annually to yield 6.24% based on yesterday's $60.25 closing price.
RDS.A Gains?
Adding the $3.76 annual estimated dividend to my $14.75 estimate of Shell's price upside shows an $18.51 potential gross gain, per share, which will be reduced by any costs to trade these shares.
Say we put a little over $1,000.00 today into Royal Dutch Shell PLC at its recent $60.25 price, we'd buy 17 shares of RDS.A.
A $10 broker fee paid half at purchase and half at sale could cost us about $0.59 per share.
Subtract that $0.59 brokerage cost from the estimated $18.51 gross estimated gain per share leaves a net gain of $17.92 X 17 shares = $304.64 or a 30.45% net gain on a $1,024.25 investment.
Therefore, Royal Dutch Shell PLC, whose trading ticker symbol is RDS.A shows a possible 30.45% net gain including a 6.24% dividend yield. It could be more, it could be less.
The above speculation is based on past year performance. The actual results remain to be seen to learn if Royal Dutch Shell PLC is worth your time and money.
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