Bull of the Day: TotalEnergies SE (TTE)

TotalEnergies SE TTE currently sports the highly-coveted Zacks Rank #1 (Strong Buy) and is among the top five publicly traded global integrated oil and gas companies based on production volumes, proved reserves, and market capitalization. Founded in 1924, TTE has operations in more than 130 countries spanning five continents.

TotalEnergies’ operations are divided into four primary segments: Exploration and Production, Integrated Gas, Renewables and Power, and Refining and Chemicals.

The company has benefited from new startups, increases in commodity prices, well-spread LNG assets, and an expanding upstream portfolio that has exposure to rapidly-growing hydrocarbon-producing regions. By 2050, TTE aims to achieve net-zero emissions through regular investments that expand renewable operations.

Share Performance

TTE shares have been a beautiful place for investors to park their hard-earned cash throughout 2022, providing investors with a strong 22% return that easily outpaces the general market’s decline.

Image Source: Zacks Investment Research

In fact, shares have been a hot item over the entire past year, penciling in a sizable 30% return and once again easily outpacing the S&P 500’s slight decline of -0.5%.

Image Source: Zacks Investment Research

Quarterly Performance

TTE has exceeded the Zacks Consensus EPS Estimate in each of its last four quarters, with an average EPS surprise sitting in the double-digits at 17%. In its latest quarterly release, the company beat earnings estimates by a sizable 22%.

Additionally, the top-line has displayed robust strength. In 2022 Q1, the company reported sales of $64 billion, which displayed a sizable 66% increase in revenue from the year-ago quarter. Furthermore, the company’s top-line expanded a massive 54% from $119 billion in FY20 to $210 billion in FY21.

Image Source: Zacks Investment Research

Valuation

The company sports an enticingly low 4.9X forward earnings multiple, nowhere near 2020 highs of 49.1X and well below its median of 11.4X over the last five years. Furthermore, the value represents a deep 73% discount relative to the S&P 500’s forward P/E ratio of 18.6X.

TTE boasts a Style Score of an A for value.

Image Source: Zacks Investment Research

Forecasted Growth

Over the last 60 days, analysts have rapidly upped their earnings outlook with a 100% revision agreement across all timeframes – undoubtedly a bullish signal.

The Consensus Estimate Trend for the upcoming quarterly release has soared 65%, reflecting earnings of $3.06 per share – a massive 140% growth in earnings from the year-ago quarter.

Additionally, for FY22, the EPS estimate has climbed 31%, reflecting earnings of $11.81 per share and a sizable 76% expansion in the bottom-line year-over-year.

Bottom Line

One of the best ways investors can find expected winners within the market is by utilizing the Zacks Rank – one of the most potent market tools out there. A portfolio consisting of Zacks Rank #1 (Strong Buy) stocks has beaten the market in 26 of the last 31 years with an average annual return of 25%.

Additionally, the top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.

For investors looking to add a solid stock to their portfolios, TotalEnergies SE would be a great bet, displayed by its Zack Rank #1 (Strong Buy). 

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.