Piper Sandler Starts Coverage on Big Oil Majors BP, Shell and TotalEnergies with Neutral Ratings

Piper Sandler on Thursday assumed coverage of three major European integrated oil companies — BP (LON: BP.), Shell (LON: SHEL), and TotalEnergies (NYSE: TTE) — all with Neutral ratings, signaling a wait-and-see stance across the sector.

Analyst John Royall initiated BP with a Neutral rating and a $42 price target, noting the company remains in a period of transition. BP has a new CEO, recent management and board changes, a planned business realignment, and a temporary capital allocation strategy prioritizing net debt reduction, with its share buyback currently suspended.

Still, Piper flagged attractive medium- and long-term catalysts, including growth from the BPX unconventional business, in-flight Gulf of America project growth, and the longer-term potential of the fully owned 8-billion-barrel Bumerangue discovery in Brazil.

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Shell was also assumed at Neutral, with an $88 price target. Piper noted Shell has largely shrugged off disruption to its Qatari operations tied to the Iran conflict, with shares trading roughly in line with peers since the war began. The firm views valuation as fair, with Shell’s EV/2027 EBITDA multiple near its four-times historical average.

TotalEnergies rounded out the trio, also picking up a Neutral rating and an $85 price target. Piper cited a strong organic growth profile, with production expected to grow at a 3% CAGR driven by a globally diverse mix of upstream and LNG projects, but noted valuation is trading near long-term averages, keeping the firm on the sidelines.

Shares of all three moved higher Thursday. BP’s London-listed shares rose 3.1% to 555.9p, while its U.S. ADR gained 2.4% to $44.35. Shell’s London shares added 1.6% to 3,344p, with its ADR up 1.5% to $89.10. TotalEnergies shares climbed 2.2% to $86.75.