TechnipFMC is a leading technology provider to the energy industry, specializing in projects, systems, and services for oil and gas production. Domiciled in Newcastle Upon Tyne, Great Britain, but operating out of Houston, the company has two primary segments: subsea and surface technologies. As the names imply, the subsea segment focuses on the design, engineering, procurement, manufacturing, fab...
TechnipFMC is a leading technology provider to the energy industry, specializing in projects, systems, and services for oil and gas production. Domiciled in Newcastle Upon Tyne, Great Britain, but operating out of Houston, the company has two primary segments: subsea and surface technologies. As the names imply, the subsea segment focuses on the design, engineering, procurement, manufacturing, fabrication, installation, life-of-field services for subsea production systems, field infrastructure and pipeline systems used in offshore oil and natural gas production and transportation. The surface technologies segment designs, manufactures and services equipment for land and shallow-water exploration and production, including wellheads and intervention systems. At present, the company has a substantial subsea contract backlog of just under $16 billion, providing strong revenue visibility through 2026 and beyond, assuming oil prices remain stable. Presumably, if oil prices were to move sharply lower, there's a risk that some of that backlog could evaporate if customers elected to delay or cancel. Management has guided to subsea revenue of $9.1 billion to $9.5 billion in 2026, while already strong trailing 12-month EBITDA margins of 18% are expected to expand slightly in fiscal year 2026. They also initiated a $2 billion stock buyback program in October, which — combined with $300 million from the prior program — represents roughly 9.2% of TechnipFMC's current market capitalization. Other than the risks associated with the oil and gas business generally — it is cyclical after all — arguably the biggest challenge for would-be buyers is the stock's staggering performance since its mid-2022 lows, when the stock was just $5.62 per share. It's up a staggering 1,000% in less than four years. Although the company's operating performance is strong, it has not grown anywhere near as quickly as its share price over that period. The fundamentals remain strong, although at 22x FY2026 ...