A Look at TechnipFMC (NYSE:FTI) Valuation Following Major Maha Project Contract Win

TechnipFMC (NYSE:FTI) just secured a sizable Engineering, Procurement, Construction, and Installation contract from Eni for Indonesia’s deepwater Maha project. This marks another step in their ongoing collaboration and expands the reach of their Subsea 2.0 technology.

See our latest analysis for TechnipFMC.

TechnipFMC’s latest contract win with Eni seems to have fueled already strong momentum, with a 1-month share price return of 14% and more than 52% year-to-date. The announcement builds on recent events like their participation in the TD Cowen Energy Conference, and the stock’s five-year total shareholder return has soared over 640%, which suggests that investors see long-term value and growth potential gathering pace.

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With TechnipFMC’s share price surging ahead of its latest contract win, investors are left weighing whether further growth is already factored into the current valuation or if there is still a genuine buying opportunity ahead.

Most Popular Narrative: 1.6% Undervalued

TechnipFMC's most widely followed narrative sees its fair value just above the last close, suggesting shares are still trading slightly below the consensus valuation. This narrative weighs a promising margin outlook against the realities of a mature energy sector and evolving market dynamics.

Expansion and recurring tail of Subsea services revenues, driven by a growing installed base and long-duration contracts (20, 35 years), provide predictable, high-margin income streams that underpin long-term earnings stability and net margin improvement.

Read the complete narrative.

What future numbers are powering this valuation? Hidden inside the narrative are bullish profit margin forecasts and a financial model that expects strong recurring income over the next few years. Want to see which projected shifts in margins and cash flow are making analysts take notice? The real assumptions driving this price are waiting inside.

Result: Fair Value of $45.75 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing dependence on oil and exposure to volatile global markets could present challenges for TechnipFMC’s growth outlook if conditions shift unexpectedly.

Find out about the key risks to this TechnipFMC narrative.

Another View: SWS DCF Model Flags a Larger Gap

While multiples suggest TechnipFMC trades close to consensus estimates, our SWS DCF model presents a different perspective. The DCF calculation indicates shares are trading well below fair value, which could mean the market is underestimating the long-term earnings potential within the business. Is there a bigger opportunity hiding in plain sight?

Look into how the SWS DCF model arrives at its fair value.

Build Your Own TechnipFMC Narrative

If you have a different perspective or would rather dive into the numbers yourself, it takes just a few minutes to generate your own view and see where you land. Do it your way.

A great starting point for your TechnipFMC research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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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.

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