The performance of Saipem shares
The barrel is floating without a precise direction after Tuesday’s 3.5% slide which halted the five-session positive streak. Every time central banks raise the bar on the cost of money, like Jerome Powell did, the specter of recession returns and sales begin. Speaking of sales, Russia is diverting oil to Asia that it previously destined for Europe. Production has remained high in recent months, the OPEC+ secretary general said.
Analysts noted that Northwestern European demand has already returned to 2017-21 levels. Bernstein also noted that the development of renewables is not up to the targets, due to the difficulty of obtaining permits. Gas is a different matter, which has dropped by 87% since the record peak in August (322 euros).
Prices also fell in February helped by several factors: above-average temperatures, near-record imports of LNG (liquefied natural gas), increased Algerian pipeline flows and falling demand (oil price). Despite the high levels of gas storage analysts Bernstein’s analysts continue to expect the EU gas situation to remain tense for the foreseeable future. The EU will receive 40 billion cubic meters less of Russian gas and will depend more and more on LNG.
The performance of Saipem shares
This swing has been reflected in the share price: in the last six months Saipem has been the best blue chip in Piazza Affari with a rebound of 110%. However, it is still 46% behind last year. Tenaris has gained 14.42% since November and Eni 14.71%. Thanks to the uncertainties of oil and gas in recent days, the stocks have lost momentum. Saipem is quoted around €1.41 and for the last week it hasn’t been able to close at a higher price than it opened. According to the technical analysis, it could enter the danger zone if it falls below the €1.38 threshold.
The trend would reverse with momentum above the resistance at €1.49. The situation is no better for Tenaris and Eni. Redburn’s analysts rejected the group of the Rocca family that deals with pipes just today and lowered the recommendation from Buy and Neutral considering the title now too expensive. Eni divides analysts: Ubs has lowered the Tp from €18 to €16.5 while Equita has raised it from €19 to €19.5. On the future, however, Saipem is the one positioned better. The prospects tell of a recovery scenario after five very difficult years.
The market awaits the resumption of the contract in Mozambique and has greatly appreciated the agreement with Seaway which will allow the Italian group to use the best boats on the market for drilling while waiting to renew its fleet. The consensus of analysts is positive: Intermonte has brought the Tp from €1.5 to €2; Akros from €1.4 to €1.9, Mediobanca €1.8, Citi €2.02.