Improving Offshore Activity Generates a Robust Project Pipeline for TechnipFMC; Raising FVE to $18

After incorporating 2022 results, we’re raising TechnipFMC’s fair value estimate to $18 per share from $15 as the long-awaited resurgence of offshore activity starts to materialize around the world. We now forecast top-line growth will average about 8.5% per year through 2026, up from our prior estimate of 7% over the same period. We’re also more optimistic about the firm’s long-term profitability potential and expect firmwide operating margins will average about 8.5% per year through 2027, a roughly 150 basis point improvement over our prior forecast. We maintain our no-moat and stable moat trend ratings.