Sales on Eni in Piazza Affari. In a session of generalized increases, the shares of the oil group slip by 0,97% to 13,26 euros, with a minimum reached at 13,19 euros, when the Ftse Mib rises by 0,86%.
Eni, which yesterday had gained 0,90%, in contrast with the price list, is today among the stocks covered in a Citi report on the oil sector. The analysts of the US bank, while raising their opinion on the stock to "buy", lowered the price target from 18,20 to 15,50 euros and, above all, adjusted the estimates on earnings per share for both 2011 and 2012, respectively by 9% and 27%.
The decision reflects revised oil price forecasts for the current and next year, based on the idea that global growth will be slower than previously estimated (3% in 2011 and 3,5% in 2012 ). Furthermore, Citi believes that Saudi Arabia, a key producer within OPEC, will not intervene in a timely manner to defend the price of crude oil and in light of the latest developments in Libya, it is conceivable that the country's production could resume in the last quarter of the year. Given all these considerations, US bank analysts expect an average price of oil (Brent) in the second half of 2011 of 100 dollars a barrel (down from 108 dollars a barrel) and of 86 dollars a barrel for 2012 (from 100 dollars).
Returning to Eni, considering the Italian context, the group does not appear among the favorites for the period, even if the prospects for 2013-2015 remain positive. The recovery of activities in Libya (about 10% of cash flow) could be a bullish element in the short term, however the target price cut reflects the trend in the euro/dollar exchange rate and the estimate of a long-term reduction in the ratio earnings/cash flow for the gas & power sector. On the other hand, the estimates are better for the subsidiary Saipem (+0,99% to 28,45 euros). According to Citi analysts, who confirmed the “buy” judgment by cutting the target price by 21% from 43 to 34 euros, the 2011 EPS should rise from 2,04 to 2,06.
