uploads///Stock Prices

Tracking TechnipFMC’s Returns after 3Q17

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Nov. 20 2020, Updated 4:35 p.m. ET

TechnipFMC’s stock price reaction

TechnipFMC (FTI) released its financial results for 3Q17 on October 25, 2017. On that day, FTI’s stock price reacted mildly negatively, falling 0.8% to $25.16 from the previous day’s close. Now, FTI’s stock price has fallen 29.0% compared to January 17, 2017, when FTI started trading after the completion of the merger between Technip and FMC Technologies.

The SPDR S&P 500 ETF (SPY) was unchanged on October 25 compared to the previous day’s close. The VanEck Vectors Oil Services ETF (OIH) was also nearly unchanged on the same day.

Peer Nabors Industries (NBR), which released its 3Q17 financial results on October 24, saw no change in its stock price on the day of its earnings release. You can read more about NBR’s 3Q17 earnings in Nabors Industries: What Worked and What Didn’t in 3Q17.

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TechnipFMC’s returns compared with the industry

As noted in the graph above, since January 17, 2017, FTI has outperformed the VanEck Vectors Oil Services ETF (OIH), which has fallen 32.0% since that date. The Energy Select Sector SPDR ETF (XLE), the broader energy industry ETF, has produced -10.0% returns since January 17, 2017. 

However, TechnipFMC underperformed the SPDR S&P 500 ETF (SPY), which generated 13.0% returns during the same period. The Dow Jones Industrial Average (DJIA-INDEX) rose 18.0% during the same period. The energy sector makes up 6.0% of the Dow Jones Industrial Average. 

You can read more about the energy market in Market Realist’s Is $60 Coming for US Crude Oil?

Stock price movement for FTI’s peers

Since January 17, 2017, Schlumberger (SLB) has fallen 27.0%, while Flotek Industries (FTK) saw its stock price fall 54.0% during the same period.

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Is TechnipFMC’s management increasing investment?

TechnipFMC’s management gave an account of its inbound orders and elaborated on its investments and M&A (mergers and acquisitions) activities. 

Doug Pferdehirt, TechnipFMC’s CEO, commented in the company’s 3Q17 earnings press release, “We are pursuing several downstream projects with an aggregate inbound value of over $5 billion. On these projects, we are actively working as the FEED provider or were the contractor of the original facility.” 

He added, “To extend our differentiation and further improve project economics, we are increasing our investment in the development of next generation subsea systems and integrated technologies. We also announced an agreement to acquire Plexus’ exploration-drilling products and services business, extending our Surface Technologies offering.”

In the final article in this series, we’ll discuss Wall Street analysts’ targets for TechnipFMC.

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