6) TotalEnergies SE (NYSE:TTE)
Share Price as of August 16, 2024: US$68.65
Average Upside Potential: 15.08%
TotalEnergies SE (NYSE:TTE) is an integrated oil and gas company, that explores for, produces, and refines oil around the world.
To address the challenges related to the energy transition, TotalEnergies SE (NYSE:TTE) implemented a two-pillar strategy. Firstly, it continues to establish low-cost exploration and production projects, and LNG will play an important role in the transition. Secondly, the company is building an Integrated Power segment with the help of investments in renewable power. Therefore, the company plans to invest more than 30% of its total spending in low-carbon businesses.
The company has a wide economic moat, whereby, it enjoys a low-cost and geographically well-diversified portfolio of upstream assets. Apart from this, the company’s diversified business mix offers balance during periods of hydrocarbon price volatility.
The company’s competitive advantage includes its increased FCF and ROIC. This is because traditional exploration and production assets are being used to finance short-cycle projects. TotalEnergies SE (NYSE:TTE) is focused on divesting its non-core assets as it focuses on advantaged, low-cost, and low-emission projects. This is supported by the fact that it signed a deal to divest its ~10% interest in the major oil and gas player in Nigeria to the locally owned company for $860 million.
In another development, TotalEnergies SE (NYSE:TTE) entered into a definitive agreement to sell its wholly owned subsidiary, TotalEnergies EP (Brunei) B.V., to Malaysia’s Hibiscus Petroleum Berhad for the value of $259 million.
Analysts at Wolfe Research initiated a coverage on the shares of TotalEnergies SE (NYSE:TTE) on 18th July 2024. They gave an “Outperform” rating, with a price target of $87.00 per share.
According to Insider Monkey, the number of hedge funds holding stakes in the company increased to 18 in Q1 2024 from 17 in the preceding quarter. Aristotle Capital Management, LLC, an investment management company, released its first quarter 2024 investor letter and mentioned TotalEnergies SE (NYSE:TTE). Here is what the fund said:
“During the quarter, we sold our positions in Phillips 66 and Sysco and invested in two new positions: Lowe’s Companies and TotalEnergies SE (NYSE:TTE).
Headquartered in Paris, France, TotalEnergies was founded in 1924 and is one of the world’s largest energy companies. The company operates in more than 130 countries and spans the entire energy value chain, producing and marketing oil and biofuels, liquid natural gas (LNG), renewables and electricity.
To meet the challenge of the energy transition and still ensure reliable energy in the short term, TotalEnergies has implemented a two-pillar strategy: on one end, the company continues to develop low-cost exploration and production projects, with LNG playing a vital role in the transition; on the other, it has been building its Integrated Power segment through investments in renewable power. As such, management plans to invest over 30% of total spending in low-carbon businesses and rank among the world’s top five providers of solar and wind energy by 2030. To emphasize this ambition, the company changed its name from Total to TotalEnergies in 2021…” (Click here to read the full text)
