Shell (SHEL) Price Target Lowered Despite Q1 Earnings Beat

Sultan Khalid

Tue, May 19, 2026 at 9:05 AM EDT 2 min read

Shell plc (NYSE:SHEL) is included among the Top 12 Undervalued Dividend Stocks to Buy Now.

Shell plc (NYSE:SHEL) is an integrated energy company with operations spanning exploration, production, refining, marketing, and chemical manufacturing, alongside growing investments in biofuels and hydrogen.

On May 12, Morgan Stanley lowered its price target on Shell plc (NYSE:SHEL) from £3,589 to £3,495, but maintained its ‘Equal Weight’ rating on the shares. The trimmed target still represents an upside of almost 10% from the current price level.

The move comes despite Shell plc (NYSE:SHEL) exceeding profit estimates in its Q1 2026 report on May 7. The energy giant’s profit of $6.9 billion was its highest in two years, boosted by gains amid the Iran war. However, its revenue of $69.7 billion fell below expectations by over $10.6 billion. Moreover, Shell’s total oil and gas production fell 4% from the previous quarter, mainly due to the outages in Qatar.

The strong Q1 profit prompted Shell plc (NYSE:SHEL) to raise its quarterly dividend by 5% to $0.7812 per share. However, the company reduced its quarterly share buyback program from $3.5 billion to $3 billion to bolster its balance sheet, since a short-term ​liquidity squeeze after the ongoing energy supply disruptions increased its debt.

While we acknowledge the potential of SHEL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 12 Best Blue Chip Dividend Stocks to Buy Now and 11 Best Rising Dividend Stocks to Buy Right Now

Disclosure: None. Follow Insider Monkey on Google News.