TotalEnergies is set to host its Annual Investor Day on September 29, with the market focused on expected reductions in both buybacks and capital expenditure guidance.
TD Cowen analysts said in a note that they expect the company to guide to a $4 billion buyback for fiscal 2026, below the consensus estimate of roughly $6 billion, even as capex is forecast to remain “better than feared at $17B/yr”.
The analysts noted that TotalEnergies has likely underperformed “in part due to buyback cut fear” and suggested that while some investors may view the event as a clearing point, “we suspect investors want to see how ’26 develops given it will be a trough FCF year.”
TD Cowen expects the company to guide FY25–FY30 capex to $17 billion at the midpoint and highlighted that investors are anticipating a reduction from $8 billion in 2025 to either $4 billion or $6 billion in 2026.
“We expect TTE to guide to $4B in ’26 to manage debt levels and even with a relatively benign capex update,” wrote the bank’s analysts.
The note also emphasized valuation metrics, stating that TTE has lagged its large European peers, with its dividend yield at 6.5%, “~120bps cheaper than Euro peers,” implying around 10% upside.
At $65 Brent and $8/mcf gas, TD Cowen estimates 2026 free cash flow of around $8.5 billion, meaning the $4 billion buyback would result in a payout ratio exceeding 40% and gearing approaching a potential 20% ceiling.
While the Investor Day could provide clarity, TD Cowen cautioned that it remains “unclear if investors will look past a likely weak FCF year in 2026, after this Analyst Day, or decide to see how 2026 develops before becoming more constructive.”
Source :
https://www.investing.com/news/stock-market-news/totalenegies-stock-can-the-upcoming-investor-day-act-as-a-clearing-event-4251670
