10 Best Undervalued UK Stocks To Buy Now

1. Shell Plc (NYSE:SHEL)

Number of Hedge Fund Investors: 51

Forward P/E ratio as of August 10: 8.57

Shell Plc (NYSE:SHEL) is a global energy company that generates revenue through the exploration, production, refining, and trading of LNG, crude oil products, and other energy commodities to customers all around the world.  Shell Plc (NYSE:SHEL) is investing $10-15 billion in low-carbon energy solutions between 2023 and the end of 2025 and is transitioning away from fossil fuels to low-carbon energy solutions. Shell Plc (NYSE:SHEL) is invested in renewable energy and is generating electricity using wind, solar, and hydrogen. Shell Plc (NYSE:SHEL) believes LNG will be crucial in the energy transition as an alternative to coal plans to expand its LNG business by 20-30% and aims to increase its LNG volumes by 15-25% by 2030. This focus on renewables enhances Shell Plc’s (NYSE:SHEL) ability to innovate and capture growth opportunities in the evolving energy market.

On June 18, Shell Plc’s (NYSE:SHEL) subsidiary Shell Eastern Trading Pte. Ltd., signed an agreement to acquire Pavilion Energy Pte. Ltd., a company headquartered in Singapore that has a global LNG trading business with a supply volume of approximately 6.5 million tonnes per annum and operates in trading, shipping, and natural gas supply and has marketing activities in Asia and Europe. The acquisition will be completed by Q1 2025 by using Shell Plc’s (NYSE:SHEL) existing cash capital and aims to support its LNG volumes for its gas business.

Shell Plc (NYSE:SHEL) is trading at a forward PE of 8.57, a 26% discount to its sector, and analysts expect the company to grow its earnings by 1% this year. The stock is trading at $71.88 as of August 10, up 14% from the previous year and analysts project a further upside potential of 15% to $83.78. As of the first quarter, the stock is held by 51 hedge funds and the stakes amount to $5.54 billion. Fisher Asset Management is the largest shareholder in the company and has a stake worth $1.56 billion as of March 31.

While we acknowledge the potential of SHEL, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

Read Next: Analyst Sees a New $25 Billion “Opportunity” for NVIDIA and Jim Cramer is Recommending These 10 Stocks in June.

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