Bottom Line: Investors tricked by a scary drop in earnings but treats lie in store

 
Elizabeth Fournier

AFTER BP’s forecast-beating results on Tuesday, Shell had a tough act to follow. So it’s no wonder that the profit miss – $4.5bn versus estimates of $5.1bn – has got investors running scared.

It doesn’t help that the oil giant just can’t seem to find what it’s looking for. Stunted efforts in the Arctic have so far been expensive and fruitless, and fresh fears were raised yesterday that its drill barge Kulluk, which ran aground off Alaska in 2012, may never return to service.

But many investors in the stock have never been that interested in oil and gas. Shell has always been a dividend play, and yesterday’s update gave little reason to doubt it would continue to be lucrative. According to Capita Asset Services, Shell is still paying some of the best dividends in the business, contributing £1 in every £11 of income to investors in UK companies.

And if its new chief executive pushes ahead with asset sales as planned, it might not be long before that figures creeps even higher.

Far from leaving incoming boss Ben van Beurden with an impossible act to follow, Peter Voser might just have handed him the perfect chance to come out of nowhere and impress investors.