Last Update 19 Jan 26

Fair value Increased 4.39%

FTI: Future Cash Returns And Subsea Margins Will Support Measured Upside Potential

Analysts have lifted their blended price target on TechnipFMC from about US$47.10 to roughly US$49.17, citing updated sector models that bring earnings forecasts closer to or above consensus, stronger recent results, improved free cash flow conversion, and reaffirmed confidence in subsea margin guidance.

Analyst Commentary

Street research on TechnipFMC is generally skewed toward a constructive view, with several firms lifting their price targets and pointing to a mix of execution, earnings visibility, and cash generation. At the same time, there are some clear flags around how much of the sector optimism is already reflected in share prices.

Bullish Takeaways

Bullish analysts are lifting price targets into the low to mid US$50s, which signals they see room for further value creation based on their updated sector models and company specific assumptions.
Several research notes highlight subsea margin guidance for 2026 in the 20.5% to 22% range, with a midpoint above current consensus. They view this as supportive for earnings quality and execution in the core business.
On cash generation, one analyst update points to expectations that TechnipFMC will convert around 70% of just over US$1.8b of EBITDA to free cash flow. They see this as a support for shareholder returns and de risked balance sheet management.
Group wide, some bullish analysts say their EBITDA estimates for the oilfield services space are now closer to or above consensus for outer years. They use this to justify higher targets for companies they see as well positioned, including TechnipFMC.

Bearish Takeaways

More cautious analysts flag that recent rallies across oilfield stocks following geopolitical headlines, such as expectations for higher investment in Venezuela, may already discount a lot of good news. They see this as raising the risk of stretched sentiment in the near term.
There is concern that capital deployment into higher risk geographies could take a long time and require extensive guarantees. This could push out the timing of some growth opportunities that are currently reflected in sector enthusiasm.
Even as they raise targets, some bearish analysts suggest that parts of the oilfield services group may have run ahead of fundamentals on headline driven moves. They see this as a factor that could cap upside if earnings or project awards do not track the more optimistic scenarios.
The gap between analyst EBITDA forecasts and current consensus for later years in the sector introduces uncertainty, since any reset in expectations could affect how investors value TechnipFMC alongside its peers.

What’s in the News

Won a large iEPCI contract from bp for the greenfield Tiber development in the Gulf of America, valued by TechnipFMC between US$600m and US$800m, with the award included in fourth quarter 2025 inbound orders (Client Announcements).
Awarded a substantial EPCIC contract by Eni for the Coral North FLNG project offshore Mozambique, in water depths of about 2,000 meters, valued by TechnipFMC between US$250m and US$500m and recorded in second quarter 2025 inbound orders (Client Announcements).
Secured a substantial iEPCI contract from Eni for the deepwater Maha project offshore Indonesia, marking Eni’s first use of TechnipFMC’s Subsea 2.0 configure to order technology in the country, with an indicated value between US$250m and US$500m and inclusion in second quarter 2025 inbound orders (Client Announcements).
Announced multiple significant contracts in 2025, including Subsea 2.0 production systems for Chevron’s Gorgon Stage 3 project and flexible risers for Ithaca Energy’s Captain development in the U.K. North Sea. Each contract is in the US$75m to US$250m value range (Client Announcements).
Updated 2025 guidance, with Subsea revenue expected in a range of US$8.4b to US$8.8b and Surface Technologies revenue in a range of US$1.2b to US$1.35b. The company also announced an expanded equity buyback authorization to US$3.8b and completion of US$1,454.97m of repurchases covering 14.31% of shares under the program announced in July 2022 (Corporate Guidance, Buyback Tranche Update, Buyback Change in Plan Terms).

Valuation Changes

Fair Value: The price target estimate has risen slightly from US$47.10 to about US$49.17.
Discount Rate: The assumed discount rate has edged down from 7.14% to about 7.11%, a small shift in the risk input.
Revenue Growth: The long-term revenue growth assumption has moved up modestly from about 5.04% to roughly 5.54%.
Net Profit Margin: The assumed net profit margin has eased slightly from about 11.19% to around 11.01%.
Future P/E: The future P/E multiple has been lifted from about 16.35x to roughly 17.09x, indicating a somewhat higher valuation multiple in the model.

Leading position in offshore and subsea markets is strengthened by innovative solutions, strong project pipeline, and high-margin recurring service revenues.
Continued investment in technology, operational efficiency, and portfolio optimization expands margins, supports reliable cash flow, and drives shareholder returns.
Dependence on traditional oil & gas, geopolitical risks, and slow energy transition adaptation threaten future growth, margin stability, and financial predictability amid intensifying competition.

Catalysts

About TechnipFMC

Engages in the energy projects, technologies, systems, and services businesses in Europe, Central Asia, North America, Latin America, the Asia Pacific, Africa, the Middle East, and internationally.What are the underlying business or industry changes driving this perspective?

Robust and growing pipeline of offshore oil & gas and deepwater projects globally, driven by increased capital allocation to longer-cycle offshore developments in regions such as Brazil, Guyana, Mozambique, and Namibia, is underpinning TechnipFMC's record Subsea order intake and high backlog, supporting visibility into sustained revenue growth over the coming years.
Accelerating adoption of integrated EPCI and proprietary Subsea 2.0 solutions-demonstrated by a high percentage of direct awards and customer exclusivity agreements-cements TechnipFMC's differentiated market position, reducing pricing pressure and supporting margin expansion.
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.
Continued investment and leadership in subsea innovation (e.g., all-electric subsea systems, hybrid flexible pipe, and CO2 capture technology) position TechnipFMC to capture value from both conventional oil & gas projects and the rising demand for energy transition infrastructure such as CCS and hydrogen, fostering top-line diversification and future margin upside.
Focused cost discipline, digitalization, and portfolio optimization (e.g., streamlining North American Surface operations, increasing automation) are enhancing operational efficiency and cash generation, manifesting in improved free cash flow and returns to shareholders via buybacks and dividends, positively impacting overall earnings.

TechnipFMC Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming TechnipFMC's revenue will grow by 5.8% annually over the next 3 years.
Analysts assume that profit margins will increase from 9.9% today to 10.6% in 3 years time.
Analysts expect earnings to reach $1.2 billion (and earnings per share of $3.12) by about September 2028, up from $937.5 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting $1.4 billion in earnings, and the most bearish expecting $914 million.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 15.9x on those 2028 earnings, down from 17.4x today. This future PE is greater than the current PE for the GB Energy Services industry at 15.0x.
Analysts expect the number of shares outstanding to decline by 3.38% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 7.65%, as per the Simply Wall St company report.

TechnipFMC Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

TechnipFMC's heavy dependence on Subsea and Surface Technologies tied to oil & gas production leaves it exposed to long-term secular trends toward decarbonization and reduced demand for fossil fuels, which could lead to a shrinking addressable market and declining revenues over time.
The company's significant international exposure, including involvement in geopolitically volatile markets such as Mozambique, Nigeria, and East Africa, increases the risk of project delays, receivable impairments, and margin compression, negatively impacting earnings and financial stability.
Intensifying competition, with new entrants and potential technology breakthroughs in the Middle East Surface market and non-integrated project dynamics in Brazil, could pressure pricing, reduce market share, and squeeze future net margins.
While management touts strong technology leadership and a robust direct award pipeline, a lag in pivoting towards next-generation energy transition projects (e.g., renewables, decarbonization tech) compared to competitors may limit future growth opportunities and lead to lower long-term revenue growth rates.
Prolonged volatility in oil prices may continue to cause delays in major project sanctioning and capex cycles among operators, reducing TechnipFMC's backlog visibility and making revenues and cash flows more unpredictable.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $41.136 for TechnipFMC based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $51.0, and the most bearish reporting a price target of just $30.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $11.3 billion, earnings will come to $1.2 billion, and it would be trading on a PE ratio of 15.9x, assuming you use a discount rate of 7.7%.
Given the current share price of $39.65, the analyst price target of $41.14 is 3.6% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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