WEBULL

Is Saipem (BIT:SPM) Undervalued On Rising Earnings Estimates And Sector Outperformance?

Simply Wall St · 16h ago

Saipem (BIT:SPM) has come into focus after outperforming its Oils-Energy sector peers this year, coinciding with higher full-year earnings estimates and a favorable Zacks Rank. This combination highlights shifting analyst sentiment around the stock.

See our latest analysis for Saipem.

At a latest share price of €4.408, Saipem’s year to date share price return of 76.32% and 1 year total shareholder return of 98.31% indicate strong momentum, building on recent estimate upgrades and relative sector outperformance.

If Saipem’s move has you looking across energy and infrastructure, this could be a useful moment to see what is standing out in the power grid theme via our 35 power grid technology and infrastructure stocks

After a near doubling in 12 months, Saipem’s valuation now has to work harder to justify fresh money coming in. Do the current earnings profile and analyst targets still leave enough upside for the risk being taken?

Most Popular Narrative: 26.5% Undervalued

On the most followed narrative, Saipem’s fair value of €5.99 sits well above the latest €4.41 close, which puts the recent share price surge in a different light.

The accelerating demand for energy infrastructure upgrades worldwide, from aging offshore fields to long-distance gas pipelines and renewable mega-projects, together with Saipem's technical capabilities and capital-light bidding for €53 billion in new tenders, is presented as setting the stage for a multi-year uplift in both order intake and structurally higher EBITDA margins.

Read the complete narrative.

Want to see what sits behind that uplift story? The most followed narrative leans on a specific mix of revenue growth, margin expansion and a re rated earnings multiple. The exact trade off between these moving parts is where the thesis gets interesting.

Result: Fair Value of €5.99 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Saipem’s dependence on conventional oil and gas work, as well as the risk of cost overruns or delays on complex fixed price projects, could quickly challenge that upbeat narrative.

Find out about the key risks to this Saipem narrative.

Another View: Saipem On Earnings Multiples

While the narrative fair value points to Saipem trading 26.5% below €5.99, the earnings multiple tells a tighter story. Saipem currently trades on a P/E of 27.4x versus a fair ratio of 24.6x, the peer average of 19.7x and the wider European Energy Services group at 13.5x.

That gap suggests investors are already paying a clear premium for Saipem, which can reward you if the upbeat earnings path plays out, but also raises the risk of a sharper setback if sentiment cools or forecasts are cut. How comfortable are you with that pricing cushion?

See what the numbers say about this price — find out in our valuation breakdown.

BIT:SPM P/E Ratio as at Jul 2026
BIT:SPM P/E Ratio as at Jul 2026

Next Steps

If the mix of optimism and caution around Saipem feels finely balanced, this is the moment to review the numbers yourself and decide what matters most to you, starting with the 2 key rewards and 1 important warning sign.

Looking for more investment ideas beyond Saipem?

If Saipem has sharpened your focus on where to put fresh capital, you can use the Simply Wall Street Screener to scan other opportunities before they move out of reach.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.