The Bull Case For TechnipFMC (FTI) Could Change Following Major Deepwater Angola Subsea Contract Win

• TechnipFMC recently announced it had been awarded a significant subsea contract, valued between US$75,000,000 and US$250,000,000, by Azule Energy to design and manufacture flexible flowlines and risers connecting deepwater wells to a new floating production unit for the Greater PAJ development offshore Angola.

• This award adds a meaningful project to TechnipFMC’s subsea backlog and showcases its specialized expertise in flexible pipe technology for ultra-deepwater fields.

• We’ll now explore how this new deepwater Angola contract, and its addition to TechnipFMC’s order book, could influence the investment narrative.

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TechnipFMC Investment Narrative Recap

To own TechnipFMC, you need to be comfortable tying your capital to long cycle offshore oil and gas, with subsea orders and backlog as the key near term driver and oil price volatility and energy transition as the main overhangs. The new Angola subsea award modestly supports the order book and near term revenue visibility, but does not materially change the central risk that project timing, geopolitics and commodity prices can still disrupt cash flows.

Among recent announcements, the large iEPCI award from bp for the Tiber development in the Gulf of Mexico (US$600,000,000 to US$800,000,000) feels especially relevant. Together with the Angola contract, it reinforces the core catalyst of a growing subsea backlog that could support margins and earnings, while also highlighting concentration in offshore oil and gas projects across multiple regions.

But while this contract win supports the backlog story, investors should also be aware of the risk that prolonged oil price swings could still…

Read the full narrative on TechnipFMC (it’s free!)

TechnipFMC’s narrative projects $12.1 billion revenue and $1.4 billion earnings by 2029. This requires 5.9% yearly revenue growth and an earnings increase of about $0.3 billion from $1.1 billion today.

Uncover how TechnipFMC’s forecasts yield a $76.00 fair value, a 13% upside to its current price.

Exploring Other Perspectives

Some of the lowest ranked analysts take a tougher view than consensus, assuming only about 4.2% annual revenue growth to roughly US$10.5 billion and slightly lower margins, and worry that timing or execution missteps on long duration subsea projects could still delay revenue recognition even after wins like Angola, which shows how differently you and other investors might weigh the same backlog before updating views for this new award.

Explore 4 other fair value estimates on TechnipFMC – why the stock might be worth just $76.00!

The Verdict Is Yours

Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include FTI.

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