Equities Update: Shell, Unilever, Rolls Royce…

Shell delivering steady returns despite a softening oil price

Mark Crouch, market analyst for eToro, says: “Shell delivered results that, while down on last year’s bumper profits, comfortably exceeded analyst expectations. In a weaker oil price environment, the group’s performance has been notably resilient, drawing favourable comparison with US peers rather than its more volatile UK counterpart, BP.

“Shell’s strategy of prioritising capital discipline, operational efficiency and shareholder returns, continues to underpin its stability. The company has resisted pressure to pivot aggressively into renewables, instead maintaining a firm focus on its core oil and gas operations. That decision, once criticised, now appears more justified as profitability remains robust and capital returns remain attractive.

“Share buybacks and dividends remain a central part of the investment case. And while Shell is not ignoring the energy transition, it has opted for a more gradual, commercially driven approach. In a sector increasingly split between ambition and pragmatism, Shell is positioning itself firmly in the latter camp, and for now, that stance seems to be paying off.”

Unilever holds steady amid profit challenges

Adam Vettese, market analyst for eToro says: “Unilever’s first half results show solid underlying sales growth of 3.4%, with both volumes and pricing contributing positively, showing that its core brands are maintaining momentum even against a tough consumer backdrop. Developed markets, particularly North America and Europe, performed well, while emerging markets such as India and China also showed improvement.

“However, profitability remains under pressure. Both underlying operating profit and net profit declined, with margins squeezed due to higher costs and increased investment spend. Headline turnover fell, largely on the back of adverse currency effects. Free cash flow in turn also dropped sharply as a result of the profit decline but also can be partly explained by costs associated with the planned Ice Cream business demerger. This remains on track for November and should help the company sharpen its strategic focus going forward.

“Despite these headwinds, management’s reaffirmed guidance for margin recovery in the second half and ongoing commitment to the dividend give cause for cautious optimism. The outlook hinges on Unilever’s ability to navigate currency volatility, input costs, and continued macro uncertainty. For investors, this is a classic case of defensive brand strength and steady execution, with the possibility of enhanced returns if the portfolio restructuring is executed successfully. If Unilever leans into its strengths and works through near-term profitability challenges, we could see the share price regain previous highs seen earlier in the year.”

Rolls-Royce H1 2025: Cash Flow, Contracts, and Credibility

Lale Akoner, global market analyst at eToro says: “Rolls Royce’s latest results show a business that keeps on delivering. First-half profit rose 51% to £1.73 billion, and free cash flow reached £1.6 billion. That’s ahead of expectations and led the company to raise full-year forecasts for both profit and cash generation.

“Civil Aerospace is driving the numbers, with margin hitting 25%,  a level that would’ve seemed unrealistic two years ago. It’s not just more planes flying, it’s better contracts, higher prices, and fewer loss-making deals. But what matters more for the long-term story is what’s happening outside aviation.

“Power Systems, which supplies engines to data centres, saw nearly 90% profit growth. That’s a clear play on AI and cloud infrastructure. With the addition of steady defence contracts and its leading role in the UK’s nuclear SMR programme, Rolls-Royce is building exposure to real-world trends with long-term funding behind them.

For retail investors, the story has shifted and Rolls Royce is no longer a recovery trade. It is generating cash, expanding margins, and exposed to structurally growing markets. It’s starting to operate like the business investors always hoped it would be.”