10 Best Italian Stocks To Buy Now

08. Tenaris S.A. (OTC:TNRSF)

Upside Potential: 12.01%

Latest Average Share Price Target: $16.60

Tenaris S.A. (OTC:TNRSF) stands out as a top Italian stock due to its substantial operations and a strong presence in the global steel pipe manufacturing industry. With roots in Europe and significant contributions to the energy sector, Tenaris S.A. (OTC:TNRSF) is well-positioned for growth, making it a compelling choice for investors looking to add Italian stocks to their portfolio.

For Q2 2024, Tenaris S.A. (OTC:TNRSF) posted net sales of $3.32 billion, a slight dip from the previous quarter but showcasing resilience in high-demand regions such as the Middle East and offshore oil developments. The company’s seamless pipes segment, vital for oil and gas drilling, experienced a 4% increase in volume compared to Q1 2024, offsetting a 1% decrease in overall average selling prices. This highlights Tenaris’ ability to manage product pricing even during a challenging market phase.

However, net income and operating margins were impacted due to ongoing OCTG price declines in the Americas and a $171 million litigation-related provision. Excluding this extraordinary charge, the company’s EBITDA would have been $821 million, representing 24.7% of sales. This suggests that Tenaris S.A. (OTC:TNRSF) remains fundamentally sound, with robust financial performance even amidst external pressures.

The company’s balance sheet is a notable strength, with a positive net cash position of $3.8 billion as of June 2024. Tenaris S.A. (OTC:TNRSF) generated $774 million in free cash flow during the quarter, reinforcing its capacity for share buybacks and dividends while maintaining financial flexibility. This strong liquidity, combined with strategic cost-reduction efforts and investments in new technologies, bolsters its competitive position moving forward. In summary, Tenaris S.A. (OTC:TNRSF) solid financials, global market presence, and robust balance sheet make it a highly attractive stock for investors. The stock’s upside potential and resilience in critical markets position it for continued success, despite short-term challenges in pricing and litigation issues.