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Fortum OYJ (FOJCY)
OTHER OTC:FOJCY
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Fortum OYJ
(OTC:FOJCY)
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Rating:62Neutral
Price Target:
$5.00
â–²(19.05% Upside)
Action:ReiteratedDate:02/07/26
The score is driven primarily by mixed financial performance: improved profitability and a more stable balance sheet are offset by volatile results and weak/uneven cash flow. Technicals are mildly supportive with price above key moving averages and neutral momentum. Valuation benefits from a very high dividend yield, while the earnings call was constructive but tempered by generation-volume headwinds.
Positive Factors
Renewable pipeline expansion
Adding 4.4 GW to reach ~8 GW materially strengthens Fortum’s long-term renewable development pipeline. This expands future contracted generation capacity, diversifies generation mix toward wind, and supports sustained revenue growth potential as markets shift to low-carbon supply.
Efficiency program savings
A structural EUR 100m annual fixed-cost reduction improves margin resilience and cash generation once fully implemented. Permanent lower fixed costs enhance competitiveness across market cycles, supporting reinvestment, debt service capacity and dividend sustainability over the medium term.
Healthy profit margins
Sustained high gross and operating margins indicate strong cost control and pricing power in core businesses. Robust margins provide buffer against volume shocks, enable internal funding for renewables and efficiency programs, and underpin long-term ability to generate shareholder returns.
Negative Factors
Declining revenue trend
Material multi-period revenue decline signals structural demand or portfolio issues that impair organic top-line growth. Persisting revenue contraction reduces operating leverage, constrains reinvestment in renewables and infrastructure, and raises dependency on non-organic growth to meet targets.
Weak cash flow metrics
Declining free cash flow and OCF covering less than half of net income indicate weakening cash conversion. This reduces financial flexibility for capex, renewables development, and debt repayment, and may pressure dividends or require higher external financing over the medium term.
Generation volume variability
Below-normal hydro output and unplanned nuclear outages create structural volatility in generation volumes and comparable operating profit. Reliance on weather-sensitive hydro and centralized nuclear plants exposes earnings to hydrology and reliability risks, complicating long-term cash flow visibility.
Fortum OYJ (FOJCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.59B
Dividend Yield10.93%
Average Volume (3M)176.00
Price to Earnings (P/E)24.3
Beta (1Y)0.41
Revenue Growth-19.13%
EPS Growth-30.28%
CountryUS
Employees4,451
SectorUtilities
Sector Strength65
IndustryRenewable Utilities
Share Statistics
EPS (TTM)0.06
Shares Outstanding4,486,322,300
10 Day Avg. Volume72
30 Day Avg. Volume176
Financial Highlights & Ratios
PEG Ratio-0.63
Price to Book (P/B)1.95
Price to Sales (P/S)3.34
P/FCF Ratio49.08
Enterprise Value/Market Cap0.92
Enterprise Value/Revenue3.96
Enterprise Value/Gross Profit10.31
Enterprise Value/Ebitda13.73
Forecast
1Y Price Target
$4.20Price Target Upside0.00%
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Fortum OYJ Business Overview & Revenue Model
Company DescriptionFortum OYJ is a leading clean energy company based in Finland, primarily engaged in the generation, distribution, and sale of electricity and heat. The company operates in various segments, including Power Generation, Customer Solutions, and Heat, and is heavily invested in renewable energy sources such as hydro, wind, and solar power. Fortum is dedicated to providing sustainable energy solutions and is actively involved in the transition to a low-carbon economy, offering services that encompass energy storage, electric vehicle charging, and smart energy solutions.
How the Company Makes MoneyFortum OYJ generates revenue through multiple key streams. The primary source is electricity generation, where it produces energy from both renewable and non-renewable sources, selling it to the market. The company also earns income through its Customer Solutions segment, providing electricity, gas, and heating services to both residential and commercial customers. Additionally, Fortum profits from its investments in energy infrastructure, such as district heating and cooling systems. Partnerships with other energy providers and entities engaged in energy efficiency initiatives further enhance its revenue. The company's focus on sustainability and innovation in energy solutions positions it to capitalize on the growing demand for clean energy, thereby creating additional revenue opportunities.
Fortum OYJ Earnings Call Summary
Earnings Call Date:Oct 29, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted several positive developments, such as an increase in power prices, a successful efficiency improvement program, and strong performance in the Consumer Solutions segment. However, these were offset by challenges such as decreased generation volumes, particularly in nuclear and hydro sectors, which impacted the financial results. Overall, the sentiment reflects a balanced view with significant achievements but also notable challenges.Q3-2025 Updates
Positive Updates
Increased Power Prices
Achieved power price for Q3 was EUR 46.1 per megawatt hour, higher than last year's EUR 44.1, supported by higher spot prices and strong physical optimization.
Efficiency Improvement Program
Fortum's efficiency improvement program is reducing annual fixed costs by EUR 100 million by the end of 2025, with the full run rate effective from 2026.
Acquisition of Wind Power Portfolio
Fortum acquired a 4.4 gigawatt wind power project development portfolio in Finland, strengthening its renewables pipeline to approximately 8 gigawatts.
Consumer Solutions Business Performance
Record high third quarter result in the Consumer Solutions segment, driven by improved electricity margin in the Nordics and improved gas margin in Poland.
Updated Optimization Premium
Estimated optimization premium for 2025 increased to EUR 10 per megawatt hour, up from a previous forecast of EUR 7 to EUR 9, due to higher power price volatility.
Negative Updates
Decreased Generation Volumes
Nuclear and hydro volumes were below normal levels, impacting financial performance with a decrease in comparable operating profit in the Generation segment.
Lower Comparable Operating Profit
Q3 comparable operating profit totaled EUR 97 million, a decrease compared to previous periods, reflecting lower generation volumes.
Hydro Volume Challenges
Hydro volumes for the last 12 months were 17.8 terawatt hours, below the normal output of 20 to 20.5 terawatt hours, affected by hydrological conditions.
Nuclear Outages Impact
Unplanned nuclear outages, particularly in Oskarshamn 3, reduced annual nuclear volumes by approximately 3.6 terawatt hours for 2025.
Company Guidance
During Fortum's fiscal year 2025 third-quarter webcast, CEO Markus Rauramo and CFO Tiina Tuomela highlighted several key metrics. The achieved power price rose to EUR 46.1 per megawatt hour, up from EUR 44.1 the previous year, due to higher spot prices and strong optimization, while realized market prices increased by EUR 17 per megawatt hour year-over-year. Despite this, generation volumes were affected by lower nuclear and hydro output, with hydro volumes at 17.8 terawatt hours compared to a normal year range of 20-20.5 terawatt hours, and nuclear volumes down by 3.6 terawatt hours. The efficiency improvement program is expected to reduce annual fixed costs by EUR 100 million by 2025. Fortum's comparable operating profit for Q3 was EUR 97 million, and comparable EPS was EUR 0.08. The company also adjusted its optimization premium guidance for 2025 to approximately EUR 10 per megawatt hour, up from a previous estimate of EUR 7 to EUR 9, driven by higher power price volatility. The balance sheet remained stable with a leverage ratio of 1.0x financial net debt to comparable EBITDA.Fortum OYJ Financial Statement Overview
Summary
Profitability has improved in 2024–2025 and leverage has become more manageable, but earnings quality is weakened by volatility (including a large 2023 loss) and cash flow is the main concern with uneven conversion and a sharp free-cash-flow decline in 2025.Income Statement
Profitability is generally solid for the sector in the most recent years, with 2025 showing healthy gross and operating profitability and a positive net margin. However, results have been volatile: revenue declined in 2022–2024 before rebounding in 2025, and 2023 saw a sizable net loss despite positive operating profit—highlighting below-the-line swings that reduce earnings quality and predictability.62
Positive
Balance Sheet
Leverage looks manageable for a utility profile, with debt-to-equity improving materially from elevated levels in 2021–2022 to a more moderate range in 2024–2025, alongside a stable equity base. Return on equity is positive again in 2024–2025 but has been inconsistent (notably negative in 2021 and 2023), indicating that profitability has not been steady through the cycle.70
Positive
Cash Flow
Cash generation is the key weak spot. While operating cash flow and free cash flow are positive in 2023–2025, they have deteriorated recently (free cash flow down sharply in 2025), and cash conversion is uneven—operating cash flow covers only a modest portion of net income in 2025. The 2022 period also shows very large negative operating and free cash flow, underscoring volatility and potential sensitivity to working capital or one-off cash movements.45
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.99B | 5.80B | 6.71B | 8.80B | 112.40B |
| Gross Profit | 2.09B | 2.40B | 2.90B | 3.33B | 7.23B |
| EBITDA | 1.44B | 2.04B | 2.21B | 2.46B | 4.82B |
| Net Income | 765.00M | 1.16B | -2.07B | 1.01B | -114.00M |
Balance Sheet | |||||
| Total Assets | 16.44B | 17.31B | 18.74B | 23.64B | 149.66B |
| Cash, Cash Equivalents and Short-Term Investments | 2.90B | 4.13B | 4.18B | 3.92B | 7.59B |
| Total Debt | 4.75B | 4.83B | 5.91B | 7.84B | 17.22B |
| Total Liabilities | 7.82B | 8.15B | 10.24B | 15.90B | 136.00B |
| Stockholders Equity | 8.54B | 9.07B | 8.44B | 7.67B | 12.13B |
Cash Flow | |||||
| Free Cash Flow | 340.00M | 909.00M | 1.24B | -9.30B | 3.79B |
| Operating Cash Flow | 840.00M | 1.39B | 1.82B | -8.77B | 4.97B |
| Investing Cash Flow | -614.00M | 604.00M | 1.10B | -985.00M | -5.73B |
| Financing Cash Flow | -1.46B | -2.04B | -2.61B | 6.07B | 6.01B |
Fortum OYJ Technical Analysis
Positive
4.20
Price Trends
4.53
Positive
4.37
Positive
3.99
Positive
Market Momentum
0.04
Positive
57.52
Neutral
63.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FOJCY, the sentiment is Positive. The current price of 4.2 is below the 20-day moving average (MA) of 4.65, below the 50-day MA of 4.53, and above the 200-day MA of 3.99, indicating a bullish trend. The MACD of 0.04 indicates Positive momentum. The RSI at 57.52 is Neutral, neither overbought nor oversold. The STOCH value of 63.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FOJCY.
Fortum OYJ Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $237.50B | 49.37 | 47.13% | 0.14% | 9.43% | 35.56% | |
69 Neutral | $7.73B | 26.98 | 8.48% | 5.29% | 2.54% | 124.89% | |
69 Neutral | $7.73B | 25.36 | 8.48% | 5.60% | 2.54% | 124.89% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $118.43B | 44.67 | 16.75% | 0.43% | 21.35% | -3.93% | |
62 Neutral | $21.59B | 24.31 | 10.78% | 10.93% | -19.13% | -30.28% | |
55 Neutral | $7.75B | -2.38 | -38.17% | 3.84% | 5.93% | -39.88% |
* Utilities Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.