European Energy Stocks Gaining Attention As France Energy Prices Jump 12.4%

French inflation and a 12.4% jump in energy prices are putting fresh attention on Europe’s energy heavyweights. Higher gas and petroleum costs, along with firmer services inflation, can reshape cash flows, pricing power and investor expectations across the sector. This article looks at three European energy stocks from a health and value focused screener that appear positively exposed to these trends. You will see how each company lines up against the latest inflation data and where the current backdrop might create opportunity or call for extra caution when you assess your own portfolio.

DNO (OB:DNO)

Overview: DNO ASA is an Oslo based oil and gas company focused on exploring, developing and producing fields across the Middle East, the North Sea and West Africa, with core producing interests in Kurdistan and offshore Norway as well as a portfolio of over 100 offshore licenses. It has been operating since 1971 and today concentrates on established reservoirs that can support ongoing production and cash flow.

Operations: DNO generates about US$1.9b in revenue from oil and gas activities, primarily from the North Sea at US$1.7b and Kurdistan at US$194.7m.

Market Cap: NOK16.3b

Investors looking at DNO today are weighing an oil and gas producer that is tightly linked to higher European petroleum prices and has been expanding its North Sea footprint through acquisitions like Sval Energi and the recent Gjøa transaction. Analyst forecasts describe a turnaround story, with earnings expected to move from losses to profitability and return on equity projected to improve, while the current P/S multiple sits below many peers. At the same time, heavy reliance on debt funding, exposure to Kurdistan payment and security risks, and a dividend that is not yet well covered by earnings mean the income on offer comes with trade offs that may warrant closer inspection.

DNO’s turnaround narrative and lower P/S multiple suggest an earnings story the market may not be fully pricing in yet. Compare that potential with the balance sheet and Kurdistan exposure in the 4 key rewards and 2 important warning signs

TGS (OB:TGS)

Overview: TGS is an Oslo based geoscience data company that supplies seismic surveys, well data, carbon storage solutions and wind and solar data to energy producers worldwide. Its datasets and software help oil, gas and new energy operators decide where to drill, how to manage reservoirs and how to plan lower carbon projects.

Operations: TGS generates most of its revenue from multi client data at US$1.0b and marine data acquisition at US$792.9m, with additional contributions from imaging services at US$126.9m and segment adjustments and eliminations.

Market Cap: NOK25.0b

TGS gives you exposure to higher European energy prices without owning a pure producer. When oil companies increase exploration budgets, demand for TGS’s seismic and imaging data can strengthen, and the recent 12.4% jump in energy costs in France keeps energy security firmly on the agenda. At the same time, TGS is leaning into higher margin digital and multi client work, while recent asset sales have been used to reduce debt and sharpen focus. The trade off is a high P/E multiple, earnings that still depend on large project wins, and a dividend that is not well covered by current earnings. How those strengths and pressure points balance out is what really matters for anyone assessing TGS today.

TGS sits at the crossroads of higher exploration budgets and higher margin digital data, yet its rich P/E and dividend strain leave key questions unanswered. Get the full story in the 3 key rewards and 2 important warning signs

Saipem (BIT:SPM)

Overview: Saipem is an Italian engineering group that builds and maintains large scale energy and infrastructure projects, from subsea pipelines and offshore platforms to offshore wind farms and rail lines. It combines offshore and onshore construction, drilling and project management to serve oil, gas, low carbon and civil infrastructure customers around the world.

Operations: Saipem generates most of its revenue from Asset Based Services at about €12.5b, supported by around €6.3b from Energy Carriers and €1.3b from Offshore Drilling, partly offset by segment adjustments of roughly €4.4b.

Market Cap: €8.1b

Saipem provides focused exposure to large energy and infrastructure projects at a time when energy prices in France have increased 12.4% and security of supply is back in focus across Europe. The order book is supported by recent contracts with Eni worth more than US$900m and projects such as the Neptun Deep platform, while full fleet utilization into 2028 indicates a high level of activity for yards and vessels. Net margins are relatively thin at around 1.7%, the P/E is elevated relative to many energy services peers and guidance has been reduced due to conflict related costs. The combination of a discounted DCF value and high earnings expectations makes Saipem a stock where execution quality and contract risk may be more important than headline growth forecasts.

Saipem’s thin 1.7% net margins and elevated P/E could be masking a much bigger story about contract quality and future earnings power. See how those expectations stack up in the analyst forecasts for Saipem

The three European energy stocks in this article are only a small sample, with the full screener surfacing 19 more companies that carry similarly compelling health, value and energy linked narratives through the European Energy Sector Stocks screener. Use Simply Wall St to identify and analyze the specific catalysts and storylines that matter to you so you can focus on the European energy sector stocks that best fit your highest conviction ideas.

Take Control of Your Investment Journey

If Saipem or any of these companies sound like a great opportunity, register for FREE with Simply Wall St and add your companies to a Watchlist to monitor the share price against the fair value the ideal entry point. Once you've made your move, manage your holdings with our Portfolio Command Center that filters out the noise to deliver only the most critical, actionable updates. Throughout your journey, our Community allows you to filter the best ideas from thousands of investor perspectives. By uncovering hidden catalysts and risks early, you'll accelerate your decision-making and stay one step ahead of the market.

Seeking Fresh Alternatives Beyond Energy?

Fresh opportunities can move from quiet to flying quickly. Use these curated stock lists before the crowd catches on and information goes stale. Act now and get in early.

• Target resilient cash generators while volatility is rising by scanning a curated 304 resilient stocks with low risk scores designed to help protect capital when sentiment swings.
• Explore potential electrification trends by reviewing a hand picked 35 power grid technology and infrastructure stocks that could benefit if grid upgrades and reliability remain in focus.
• Prepare for possible rate shifts by assessing a filtered 433 dividend fortresses that focuses on income streams with yields many investors may overlook.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com