Dj Technipfmc Plc Stock Underperforms Friday When Compared To Competitors Despite Daily Gains

Oilfield services provider, TechnipFMC plc FTI has given an impressive performance since the beginning of 2024. Continuing its uptrend, the stock closed Thursday’s session at $30.02 after setting a new 52-week high of $30.23 earlier in the day. As shown in this chart, with the advance, FTI shares are up nearly 50% this year, comfortably outperforming the S&P 500. The company is also faring better than its peers like Oceaneering International OII and Core Labs CLB.

FTI, OII and CLB Year-to-Date Stock Performance

Given this impressive performance, should investors still consider buying TechnipFMC stock, wait for a better entry point, or think of booking profits? Let’s delve deeper into the company’s fundamentals.

About TechnipFMC

This UK-headquartered company, in its current form, came into existence, following the January 2017 merger between Technip and FMC Technologies. TechnipFMC is a manufacturer and supplier of products, services and fully integrated technology solutions for the energy industry. It is engaged in designing, producing and servicing technologically sophisticated systems and products for subsea, onshore/offshore, and surface projects.

Fundamental Strength Backing FTI Stock

TechnipFMC’s total backlog reached a high of $14.7 million in Q3 2024, reflecting an 11.1% increase from the previous year. This growing backlog ensures strong revenue visibility and supports margin improvements. TechnipFMC raised its 2025 revenue outlook for the Subsea segment, a consistent top performer since 2017, to $8.3-$8.7 billion, from the earlier $8 billion projection, driven by an expected adjusted EBITDA margin increase to 18.5-20%. This revised guidance reflects strong confidence in ongoing project execution and demand for Subsea technologies

TechnipFMC has secured critical contracts, including deals with Petrobras for flexible pipe and subsea production systems, as well as an iEPCI project with bp for the Kaskida field in the Gulf of Mexico. These strategic alliances strengthen its market position and enhance its credibility in high-demand regions like Brazil and the Gulf, which are crucial for future growth.

TechnipFMC believes that its Subsea 2.0 platform — a new, technologically sophisticated suite of products that improves project economics by cutting down on the dimensions of the equipment installed underwater — would enjoy fast-track adoption. The next-generation, environment-friendly all-electric system should open up further opportunities.

The company’s recent $1 billion increase in share repurchase authorization, totaling $1.2 billion, aligns with its goal to nearly double shareholder distributions for 2024 compared to last year. This expanded buyback underscores TechnipFMC’s commitment to capital return while supporting stock value through substantial buybacks. This strategic move also highlights management's confidence in the company’s growth trajectory and robust cash generation capacity.

TechnipFMC’s Solid VGM Score & Northbound Analyst Estimates

TechnipFMC enjoys both Value and Growth Score of B, helping it round out with a VGM Score of B.

FTI’s earnings revisions have trended in the right direction over the past 60 days, as analysts have taken up their numbers. The Zacks Consensus Estimate for TechnipFMC’s 2024 bottom line has gone up from a profit of $1.37 to a profit of $1.55 during this timeframe, while next year’s projection has gone up from a profit of $1.90 per share to $1.96.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

The encouraging outlook for the short term has pushed the FTI stock higher.

Is the Steep Rise a Worry for TechnipFMC Stock?

TechnipFMC shares have surged by 374% during the last three years to blow away the S&P 500’s 25.5% gain and the Zacks Oil/Energy sector’s 41.4% growth. If the company can continue to beat earnings expectations, as it did in each of the past four quarters, the bulls will likely take the stock even higher.

Takeaway: You Can Still Buy TechnipFMC Stock

Given this backdrop, it should be prudent to consider buying shares of TechnipFMC. While there are some apprehensions that the company may have gotten too far ahead of itself, the spate of project awards and growing backlog should ensure strong revenue visibility and margin improvements going forward. This suggests strong long-term cash flows that should support higher price points for its shares.

TechnipFMC currently carries a Zacks Rank #2 (Buy).

You can see the complete list of today’s Zacks #1 Rank stocks here.

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