Here’s Why Mizuho Prefers BP Over Shell Shares

Mizuho began coverage of two of Europe’s largest oil majors on Monday with contrasting views, initiating Shell (LON: SHEL) at Neutral with a $98 price target while starting BP (LON: BP.) at Outperform with a $51 price target.

Shell shares fell 0.5% during the session to 3,220p, though the stock remains up 17.4% year-to-date. BP shares gained 0.9% to 521.9p, up 20.8% year-to-date. September Brent crude rose 0.9% to $88.88 a barrel.

On Shell, Mizuho noted the stock trades at a discount to peers thanks to enhanced margins from its marketing and supply organisation, which complements its hard assets across both upstream and downstream operations.

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However, the firm flagged Shell’s lower reserve life, challenged margins in refining and chemicals, and potential litigation risk as headwinds, concluding that the stock’s risk/reward relative to peers is balanced.

For BP, Mizuho said investors are now focused on the company’s ability to execute on growing upstream cash flows sustainably, following a strategic reset away from renewable technology investments.

The firm pointed to progress made in 2025, including 12 discoveries and seven projects brought online, as evidence of execution. Mizuho also cited BP’s above-peer return on capital and continued focus on debt reduction as supportive factors behind its Outperform rating.

According to TradingView data, 15 of 31 analysts covering Shell rate the stock a buy, with 16 holds and no sells. For BP, 14 analysts rate the stock a buy, alongside 13 holds and 4 sells, reflecting a somewhat more divided view among the broader analyst community.