Royal Dutch Shell (LON:RDSA, LON:RDSB) usually needs little introduction. It is one of the world’s largest oil and gas companies, originally formed in 1907 through the merger of Royal Dutch and Shell Transport and Trading, although the two companies only formally unified into a single holding company in 2005.
Shell is now the largest company on the London Stock Exchange with a market capitalisation of some £137bn taking into account its ‘A’ and ‘B’ classes of share capital. In 2012 it was also the largest dividend payer on the FTSE when excluding the special dividend of Vodafone so perhaps unsurprisingly then it is a core shareholding of many funds and income portfolios.
In Shell’s results for the year ended 31 December 2012 the company reported basic earnings per share (on a current cost of supplies basis) of $4.32 and a dividend for the year of $1.72. At a current share price for the class B shares (the ones usually purchased by UK investors for withholding tax reasons) of 2,178p and based upon current exchanges rates I make that a trailing P/E ratio of just 7.7 and a dividend yield of 5.2%.
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