-- RBC Capital Markets revised its model for TotalEnergies (TTE.PA, TTE.L), adjusting earnings forecasts for the French energy giant following a "solid set of numbers" for the first quarter, noting minor beats across divisions.
"Despite the Middle East outages, which will be more impactful in Q2, TTE's Integrated model benefited across oil, gas and power. The closure of the EPH deal is also a big milestone for the Power business. We continue to like TTE for its resource hopper and diversified growth trajectory to 2030 and beyond. It remains on RBC's Global Energy Best Ideas list and we maintain our Outperform rating," analysts said Wednesday, noting they also kept the stock's price target at 85 euros.
Against this backdrop, the research firm lowered its full-year 2026 EPS forecast by 2% due to the expected impact of sustained disruptions in the Middle East, which outweighs gains in power and marketing services. On the other hand, the early closure of the EPH deal bolstered RBC's earnings expectations for the power division, with 2027 and 2028 EPS projections increasing by 1%.
While the research firm sees upside potential for shareholder distribution, analysts expect buybacks to remain flat at $1.5 billion heading into the third quarter, followed by an increase to $2 billion in the next three-month period, as TotalEnergies is expected to prioritize its balance sheet amid a volatile macroeconomic landscape.