Tenaris (1K) | Hold Hold | Better market environment ahead

Research evidence excerpt

Tenaris (1K) | Hold Hold | Better market environment ahead

FCF 1,858 1,820 2,149

be at USD634m (22% margin) EPS adj. and ful. dil. 1.90 2.13 2.43

Consensus EPS 1.8 1.9 2.1

Management appeared very optimistic for H2 and 2027, underlying a recovery in Net dividend 0.89 0.89 0.89

the US market (c.50 additional rigs by year-end) and international activities

FY to 31/12 (USD) 12/26E 12/27E 12/28E(c.+10% rig count), together with a price increase. Volumes and margin should P/E adj and ful. dil. 13.4 11.9 10.5

recover from H2. EV/EBITDA 9.0 8.3 7.4

Management clearly underlined that they would be very well placed for potential EV/EBIT 11.5 10.2 8.9

FCF yield 7.0% 6.8% 8.1% large pipeline work in the Middle East, with notably rolling mill capacity (large Dividend yield 3.5% 3.5% 3.5%

diameter) in Saudi Arabia for c.450kt ND(F+IFRS16)/EBITDA -1.0 -0.9 -0.8

FCF will remain strong, and the shareholder remuneration will remain based on Gearing -18.4% -16.6% -16.5%

ROIC 27.0% 30.1% 33.6%

share buyback and dividends. On that side, we do not rule out a potential special EV/IC 2.6 2.5 2.5

dividend as the net cash position remains very large (USD3.8bn), even if FCF

(USD1.9bn) does not cover the current dividend (USD900m) and Buyback

(USD1.2bn)

Increasing our EBITDA over 2026-28E

We have increased 2026E EBITDA by 4% to USD2.8bn, assuming

We have increased 2027-28E EBITDA by 8% in average.

Hold. TP increased to EUR25.

We update our two valuation methodologies: SOP and FCF yield. We especially Kevin Roger

Head of Energy Equipment and Services

move forward the valuation from 2026E to the average of 2026-27E, as the market +33 1 53 65 36 74

environment is more supportive and earnings are very likely to increase QOQ. kroger@keplercheuvreux.com

We have a new fair value of EUR25.