One unique energy stock is a ‘grand slam’ for investors, Benchmark says

The oilfield services company TechnipFMC has become a “grand slam” for investors after its stock broke out to multi-year highs and recently topped a $10 billion market value, according to Benchmark. “In baseball terms, this is a Grand Slam with the stock hitting the screens of momentum, value, large cap, and income investors,” analyst Kurt Hallead told clients in a note Monday. The analyst has a buy rating on the stock and a $30 price target, implying 20% upside from Thursday’s close of $25.11. TechnipFMC, formed in 2017 after the merger of Technip of France and FMC Technologies, provides technology solutions for the traditional oil and gas sector, both below the sea and at the surface. It is also involved in emerging areas such as carbon capture and storage that are important for the energy transition. TechnipFMC expects to book more than $30 billion in subsea orders through 2025, up 25% compared to the company’s prior target. The company offers unprecedented revenue visibility, margin expansion and free cash flow generation, Hallead told clients. “This sustainable FCF growth will be a boon to income investors,” the analyst wrote. TechnipFMC was also recently awarded a $200 million contract to develop the first all-electric carbon dioxide transportation and storage system in the North Sea. The oil industry is investing in carbon capture technology as a way to reduce emissions for heavy industries that are hard to decarbonize. Rystad Energy puts the total addressable market for carbon capture and storage (CCS) at $270 billion, Benchmark said. “CCS is an emerging growth opportunity that the industry has been talking about … for a while, but now it’s getting real,” Hallead said. — CNBC’s Michael Bloom contributed reporting