TechnipFMC is Thursday's IBD Stock Of The Day, with the oil field services provider trading just below a buy point as Wall Street predicts 160% earnings growth this year while the company has already signed three majors deals in 2024.
The Houston and Newcastle, U.K.-based company topped fourth-quarter earnings and revenue expectations on Feb. 22, with EPS of 14 cents, up from a 5-cent-per-share loss a year ago. FTI sales grew 22% in Q4 to $2.078 billion.
For the full year, TechnipFMC reported earnings of 45 cents per share, breaking two straight years of losses. The oil field service firm also forecast 2024 revenue between $8.4 billion and $8.95 billion. Analysts predict 2024 sales of $8.71 billion, according to FactSet.
For the current quarter, Wall Street forecasts EPS growth of 340% with a 160% earnings increase in 2024.
TechnipFMC competes with S&P 500 stocks Halliburton and Baker Hughes. Rebounding oil prices also have been helping TechnipFMC and other oil plays.
U.S. oil prices on Thursday traded around $78.66, with West Texas Intermediate (WTI) on pace for a 4% gain in February. WTI prices increased 5.7% in January.
Recent Deals With Energy Giants
Meanwhile, TechnipFMC has already inked three new contracts with major oil firms BP, Shell and Petrobras this year.
Organized in two business segments — Subsea and Surface Technologies — TechnipFMC provides fully integrated projects, products and services for the traditional and new energy industries. It works with oil and gas firms to develop energy resources while helping its partners reduce their carbon footprints.
On Feb. 15, Shell awarded TechnipFMC a contract for the first integrated Engineering, Procurement, Construction and Installation (iEPCI) project to use high-pressure subsea production systems rated up to 20,000 psi (pounds per square inch). TechnipFMC will make and install subsea production systems, umbilicals, risers and flow lines for Shell's Sparta development in the Gulf of Mexico.
Last month, TechnipFMC received a contract from BP for another Gulf of Mexico project. For BP's Argos Southwest Extension project in the Mad Dog field, TechnipFMC will install pipe and an umbilical, tying back three new wells.
Also in January, FTI and Petrobras inked a major iECPI contract. The Petrobras deal calls for TechnipFMC to deliver the Mero 3 HISEP project, which uses subsea processing to capture carbon dioxide-rich dense gases and then inject them into the reservoir.
TechnipFMC Stock
FTI shares dipped 1.1% to 21.67 during Thursday's market action. Last week, FTI leapt 9.2% to 21.53, surging more than 6% on Feb. 22 after Q4 earnings. In February, FTI shares are up around 14%.
TechnipFMC stock cleared resistance at 20.57 and 20.71 while also decisively clearing a downward-sloping trendline on Feb. 22.
Shares are moving toward the official 22.78 buy point in a cup base. The stock may be working on forming a handle to its cup base.
TechnipFMC stock has a 93 Composite Rating out of 99, an 84 Relative Strength Rating and an 81 EPS Rating.
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