2Q26 Results: Downstream-Driven Beat; Stepping Up Buybacks

Research evidence excerpt

2Q26 Results: Downstream-Driven Beat; Stepping Up Buybacks

Update

July 23, 2026 07:03 AM GMT

Morgan Stanley & Co. International plc+MRepsol | Europe Guilherme Levy

Equity Analyst

2Q26 Results: Downstream- Guilherme.Levy@morganstanley.comMartijn Rats, CFA +44 20 7425-6616

Equity Analyst and Commodities Strategist

Martijn.Rats@morganstanley.com +44 20 7425-6618

Driven Beat; Stepping Up Alice Bergier Winograd

Alice.Winograd@morganstanley.com +44 20 7425-0174

Buybacks

Repsol (REP.MC, REP SQ)

Energy | Spain

AlphaSignals Earnings Reaction

Stock Rating Equal-weight

Unchanged Modest upside Modest revision higher Industry View In-Line

Impact to our thesis Financial results versus consensus Direction of next 12-month Price target €24.00

consensus EPS Shr price, close (Jul 22, 2026) €25.48

52-Week Range €25.53-12.79

Source: Company data, Morgan Stanley Research Mkt cap, curr (mn) €28,241

Net debt (12/26e) (mn)* €8,256

EV, curr (mn)* €41,869

Key Takeaways

* = GAAP or approximated based on GAAP

Earnings beat consensus by 12% driven by higher-than-expected downstream

results.

Cash flow ex W/C strong; debt down despite the W/C build this quarter.

Buyback pace increasing to €500mn to October, with a third tranche to be

announced later this year.

Expect focus in the call on refining strength (spot indicator at $36/b) and capital

allocation decisions against this backdrop.

Results in a nutshell: Repsol's adjusted net income of €1,838mn in 2Q beat our

forecasts and the Street by 12-16%, mostly driven by better-than-expected results in

the Industrial and Customer divisions, as well as breakeven results in the Corporate

& Others segment. In total, that more than offset the slight Upstream miss.

CFFO excluding W/C was also strong, at €3.3bn, which compares with our forecasts