ii view: TotalEnergies repeats prediction for output growth in 2026
Raising targeted cost savings to 2030 and offering an attractive dividend yield. Buy, sell or hold?
11th February 2026 16:08
by Keith Bowman from interactive investor
Photo: John Keeble/Getty Images.
Full-year results to 31 December
- Adjusted profit down 15% to $15.6 billion (£11.4 billion)
- Q4 dividend payment of €0.85 (74p), unchanged from Q3
- Total 2025 dividend payment up 5.6% to €3.40 per share
- Total 2025 share buyback of $7.5 billion, down from $8 billion in 2024
- Gearing of 15%, up from 8.9% at the end of 2024
Guidance:
- Continues to expect 2026 share buybacks of $3-6 billion
Chief executive Patrick Pouyanné said:
“With cash flow stable, TotalEnergies once again demonstrates its ability to offset lower hydrocarbon prices thanks to accretive growth in its Upstream production.”
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ii round-up:
Oil major TotalEnergies SE (EURONEXT:TTE) today reiterated hopes for increased production in 2026, but underlined the tough economic backdrop by keeping its final quarterly dividend payment for 2025 unchanged.
Buoyed by 2025 project ramp-ups in Brazil, Iraq, Algeria and Uganda, energy production is expected to rise by 5% in 2026 versus last year. The final Q4 2025 dividend payment of €0.85 (74p) per share is unchanged from the third quarter, although the cumulative full year payment of €3.40 per share is up 5.6% from 2024.
Shares in the Euronext listed company rose 1.5% in European trading having come into these latest results having gained 4% in 2025. The Euronext 100 index rose by nearly a fifth last year and UK headquartered Shell (LSE:SHEL) and BP (LSE:BP.) gained by a tenth.
Total operates in nearly 120 countries including Liquefied Natural Gas (LNG) operations and over 25 Gigawatts of renewable energy production.
Adjusted profits fell 15% in 2025 year-over-year to $15.6 billion (£11.4 billion), hindered by a near one-fifth fall in the oil price during the period.
Asset sales helped group net debt fall to $20.2 billion as of late December, down from $24.6 billion at the end of the prior third quarter. Group leverage or gearing of 15% rose from 8.9% at the end of 2024 due to the cost of production ramp-ups.
Planned share buybacks of $3-6 billion over 2026 include authorisation for up to $0.75 billion in the first quarter to late March.
Broker Morgan Stanley reiterated its ‘overweight’ stance on the shares post the results, flagging the company as a ‘top pick.’ First-quarter results are scheduled for 29 April.
ii view:
Started in 1924, the company changed its name to TotalEnergies from Total back in 2021. Operations include Exploration & Production, Integrated Gas, Renewables & Power - including solar and offshore wind - as well as Refining & Chemicals. Over 13,000 service stations include more than 78,000 EV charging points.
For investors, US trade tariffs continue to overhang future energy demand, with talks between the world’s two biggest economies, the US and China, still ongoing. A forecast price/earnings (PE) ratio above the three-year average may suggest the shares are not obviously cheap. The volatility of energy prices in recent years from the lows of the pandemic to highs following the Russia’s invasion of Ukraine should not be forgotten, while the pricing of Total’s shares in euros also adds the additional risk of currency movements for UK investors.
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On the upside, production up 3.9% in 2025 helped counter a near one-fifth fall in the oil price, with production again expected to rise over 2026. Targeted cost savings between 2026 and 2030 have been raised to $12.5 billion from a previous $7.5 billion. A forecast return on capital employed (ROCE) of 13.4% is above the 11.4% and 9.1% estimates at rivals Shell and BP, while continuing expansion of its renewable power ops helps counter ongoing concerns for climate change.
In all, and despite continued risks, a forecast dividend yield of around 5% should help keep this major European energy company of interest to investors.
Positives:
- Geographical diversity of operations
- Attractive dividend payment (not guaranteed)
Negatives:
- Uncertain economic outlook
- Currency risks
The average rating of stock market analysts:
Buy
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