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Repsol (REPYY)
OTHER OTC:REPYY
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Repsol
(OTC:REPYY)
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Rating:62Neutral
Price Target:
$22.50
▲(23.09% Upside)
Action:ReiteratedDate:02/21/26
The score is driven primarily by weakening fundamentals (declining revenue, compressed margins, and softer free cash flow) despite a still-moderate leverage profile. Technicals add support with a strong uptrend, though momentum is stretched. Valuation is fair with a supportive dividend, and the earnings call was constructive on cash flow, CapEx discipline, and shareholder returns but flagged meaningful near-term industrial and earnings headwinds.
Positive Factors
Renewables scale-up
Repsol’s sustained additions (2.2 GW in 2025) and asset rotations expand low‑carbon generation and free up capital. Building ~6 GW of capacity plus monetization via rotations creates recurring clean‑power cash flows and diversifies revenue away from volatile hydrocarbons over the medium term.
Disciplined capital allocation & shareholder returns
Management’s policy of steady dividends, recurring buybacks and asset rotation shows durable capital discipline. Consistent distributions (dividend rise and buyback program) signal priority on shareholder returns while capex normalization preserves investment flexibility across commodity cycles.
Conservative net debt profile
Low net debt excluding leases and modest gearing provide balance‑sheet flexibility to fund growth and weather cycles. Management expects net debt broadly flat in 2026, supporting investment in upstream ramp‑ups and renewables while maintaining capacity for buybacks and dividends without levered stress.
Negative Factors
Margin compression and revenue decline
A marked decline in revenue and a ~10ppt gross margin deterioration versus 2022 indicate weaker earnings power and greater sensitivity to commodity and market conditions. Sustained margin compression erodes reinvestment capacity and increases volatility in long‑run profitability across cycles.
Weakening cash generation
Operating cash flow and free cash flow have trended lower, with FCF covering only a fraction of net income. Reduced cash conversion limits reinvestment, heightens reliance on asset rotations or external funding, and makes sustained shareholder payouts more vulnerable if underperformance continues.
Operational & industrial disruption risk
Recurring industrial events (blackouts, fires, lower utilization) materially compress refining throughput and margins. Prolonged repairs and logistics changes reduce durable operational reliability, increase unit costs, and amplify exposure to margin volatility in downstream operations over multiple quarters.
Repsol (REPYY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$22.69B
Dividend Yield5.18%
Average Volume (3M)58.12K
Price to Earnings (P/E)18.2
Beta (1Y)0.55
Revenue Growth-4.83%
EPS Growth-41.69%
CountryUS
Employees25,136
SectorEnergy
Sector Strength52
IndustryOil & Gas Integrated
Share Statistics
EPS (TTM)0.69
Shares Outstanding1,105,374,400
10 Day Avg. Volume70,856
30 Day Avg. Volume58,122
Financial Highlights & Ratios
PEG Ratio1.12
Price to Book (P/B)0.84
Price to Sales (P/S)0.35
P/FCF Ratio16.01
Enterprise Value/Market Cap1.36
Enterprise Value/Revenue0.56
Enterprise Value/Gross Profit3.51
Enterprise Value/Ebitda5.66
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Repsol Business Overview & Revenue Model
Company DescriptionRepsol S.A. is a global energy company based in Spain, primarily engaged in the exploration, production, refining, and distribution of oil and natural gas. The company operates across several sectors including upstream (exploration and production), downstream (refining, distribution, and marketing of petroleum products), and renewable energy. Repsol also invests in innovative technologies and sustainability initiatives, aiming to transition towards cleaner energy solutions.
How the Company Makes MoneyRepsol generates revenue through multiple key streams. The upstream segment, which involves the exploration and production of hydrocarbons, contributes significantly to its revenue through the sale of crude oil and natural gas. The downstream segment generates income by refining crude oil into various petroleum products, including gasoline, diesel, and jet fuel, which are then marketed and sold through a vast network of service stations and distributors. Additionally, Repsol has been investing in renewable energy projects, such as wind and solar power, which are expected to become increasingly important revenue sources as global energy markets transition. The company also benefits from strategic partnerships and joint ventures that enhance its operational capabilities and market reach, contributing positively to its overall earnings.
Repsol Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call balanced clear operational progress, disciplined capital allocation and strong customer and renewables momentum against near-term earnings and industrial disruptions. Management highlighted higher cash generation (CFFO), normalized and lower net CapEx, expanding shareholder distributions, successful asset rotation and solid renewables growth. Offsetting these positives were a 15% decline in adjusted net income, material Industrial headwinds from Spanish blackouts and the Cartagena incident, some production effects from disposals and quarter-specific exploration costs, and continued exposure to commodity and regulatory volatility. Overall, the operational and financial fundamentals (cash flow, low net debt excl. leases, shareholder returns and renewables monetization) provide constructive momentum while certain near-term earnings and industrial inflection points remain risks.Q4-2025 Updates
Positive Updates
Strong Cash Flow and Improved Guidance for 2026
Cash flow from operations (CFFO) was EUR 5.4 billion in 2025 (+8% YoY). Under the new reporting model management guides 2026 CFFO to EUR 5.5–6.0 billion (vs EUR 5.4 billion in 2025), reflecting expected higher contribution from new upstream volumes, industrial turnaround in chemicals/refining and growth in customer and renewables.
Disciplined Capital Allocation and Shareholder Returns
Total shareholder distributions were EUR 1.8 billion in 2025 (EUR 1.1 billion cash dividends and EUR 700 million buybacks). Dividend increased to EUR 0.975 per share in 2025 (an 8.3% year-over-year increase in the announced dividend); management expects cash dividend ~EUR 1.051 per share for 2026 (~8% increase) and has approved a new buyback program of up to EUR 350 million.
Net CapEx Normalization
Net capital expenditure fell to EUR 2.7 billion in 2025 (compared with EUR 5.1 billion net investment in 2024 including Outpost rotation under the previous model), and management guides net CapEx for 2026 at EUR 2.7 billion under the new reporting model, showing a return to more normalized CapEx levels.
Low Net Debt and Healthy Balance Sheet Metrics
Net debt closed at EUR 4.5 billion at year-end 2025 (EUR 0.5 billion above 2024 but explained by reporting/transaction effects); excluding leases net debt was EUR 1.6 billion (≈5% of capital employed). Gearing stood at 14% (5.5% excluding leases). Management expects net debt to be broadly flat through 2026 under plan assumptions.
Upstream Production Growth and Project Delivery
2025 production averaged 548,000 boe/d (at the higher end of guidance). Excluding disposals production was +2% YoY; achieved important first gas/oil milestones (Cypre, Mento, Leona, Castille). Alaska Pikka first phase nearing completion with production expected to start in March 2026; combined G5 projects expected to contribute ~80,000 b/d (low breakeven, low CO2) by 2027.
Material Recovery and Growth in Libya
Libya reached the highest production since 2012 with gross production exceeding 300,000 b/d during 2025 (peak ~326,000 b/d) and Repsol expects Libya gross production near 350,000 b/d by end-2026, implying ~40–43,000 b/d net to Repsol.
Customer Segment Outperformance
Customer adjusted net income was EUR 754 million (+17% YoY). EBITDA reached EUR 1.4 billion (+20% YoY), achieving the 2027 strategic EBITDA target two years early. Mobility fuel sales +11% YoY; non-oil contribution margin in Spain +12% YoY; digital clients reached ~10.8 million (+16% YoY); power & gas retail reached ~3.0 million customers (added >0.5 million in 2025).
Renewables Growth and Asset Rotation
Low-Carbon Generation adjusted net income EUR 53 million (+EUR 77 million vs 2024). Power generated 11.6 TWh (+49% YoY); renewable generation 7.7 TWh (+34% YoY). Added 2.2 GW in 2025 bringing capacity to ~5.9 GW (now ~6.0 GW). Rotated 1.8 GW via three transactions and captured ~EUR 2.7 billion of capital since 2018 through asset-level debt, tax equity and rotations (average equity IRR >10% on rotated assets).
Decarbonization and Operational Emissions Progress
Company delivered its 2025 decarbonization commitments set in 2021: a 15% reduction in the carbon intensity indicator; methane emissions intensity and routine flaring reduction targets were also met. Continued investment in renewable fuels, HVO retrofits (Puertollano starting next quarter), and large-scale electrolyzers (100 MW projects) advances low-carbon platform.
Negative Updates
Adjusted Net Income Decline
Group adjusted net income for 2025 was EUR 2.6 billion, down 15% year-over-year, driven by weaker realizations, divestment effects and lower contributions from some equity affiliates.
Industrial Division Profitability Impacted by Blackouts and Market Headwinds
Industrial adjusted net income was EUR 963 million, EUR 484 million below 2024. Spanish blackouts in April materially impacted results; refinery distillation utilization averaged 83% in 2025 vs 88% in 2024 and conversion units operated at 95% vs 100% in 2024. Chemicals recorded a loss despite a 20% improvement in its margin indicator due to weak European demand and import pressure.
Refining & Operational Disruption — Cartagena Fire
On 25 January 2026 a leak and fire affected a crude distillation unit at Cartagena. The CDU rebuild/repair is expected to last ~8 months; estimated uninsured/logistical cost impact roughly EUR 18–25 million (approx. EUR 6–8 million/month for three months), while insurance covers the rest. Distillation capacity disruption required logistical adjustments to feed conversion units.
Overall Production Slight Decline and Upstream Income Pressure
Full-year production averaged 548,000 boe/d, a 4% decline vs 2024 (higher volumes in Libya and U.K. offset by disposals and natural decline). Upstream adjusted net income was EUR 957 million, down 7% YoY, and Upstream operating income was reported down ~50% quarter-on-quarter due to lower oil prices, disposals (Indonesia/Colombia) and ~EUR 80 million of exploration costs recognized in the quarter.
Commodity Price Headwinds
Brent averaged $69/bbl in 2025, down ~15% YoY, reducing upstream realizations. European TTF rose ~12% and Henry Hub averaged $3.4/MMBtu (+48% YoY), creating mixed effects (higher gas prices helped gas margins but increased costs in some areas).
Net Debt Increase (Reporting/Transaction Driven)
Net debt increased to EUR 4.5 billion (EUR +0.5 billion vs 2024). Management attributes the change largely to reporting/transaction effects (NEO NEXT reclassification and hybrid issuance) rather than material deterioration in leverage; however the headline increase is a short-term negative datapoint.
Chemical Business Still Loss-Making in Europe
Despite a 20% improvement in chemical margin indicators, the chemicals business incurred a loss due to flat demand, relatively higher costs compared with other regions, and significant product imports into Europe.
Regulatory/Legal Uncertainties — Blackout Claims and Hydrocarbon Tax
The company has a potential claim related to the April 28 blackout of approximately EUR 125 million (management views it as recoverable but awaits regulator report). Also awaiting potential Supreme Court outcomes related to regional hydrocarbon tax litigation (uncertainty around recoverability and timing).
Complexity from New Reporting Model
Repsol implemented a new group reporting model recognizing joint ventures under the equity method and changing presentation of minority stakes. Management warns this is complex and affects comparability (adjusted metrics decreased vs prior year), which can create investor uncertainty in the near term.
Refining Utilization and Margin Volatility
Refinery utilization was reduced in 2025 by blackouts and other disruptions; while margins improved in H2 and indicator averaged $79/bbl for 2025, the business remains exposed to margin volatility and to geopolitical shifts that affect product flows (e.g., sanctions and heavy crude availability).
Company Guidance
The company guided to a 2026 planning scenario with Brent $60–65/bbl, Henry Hub $3.5–4/MMBtu and a refining margin indicator of $6.5–7.5/bbl, and under that outlook expects cash flow from operations of EUR 5.5–6.0 billion (vs. EUR 5.4bn in 2025) with net CapEx steady at about EUR 2.7 billion; shareholder distributions will keep improving (cash dividend up ~8% to around EUR 1.051/share in 2026, buybacks “in line” with 2025 and a new Board‑approved buyback of up to EUR 350m), net debt which closed at EUR 4.5 billion (EUR 1.6bn excl. leases) is expected to be broadly flat over the year (gearing ~14%, ~5.5% excl. leases), Upstream production is guided to 560–570 kboe/d (with Alaska ramping to ~80k bbl/d gross by Q3 and Libya ~350k bbl/d gross by year‑end, ~40–43k bbl/d net), and the renewables platform continues to scale (2.2 GW added in 2025, ~6.0 GW installed today, 1.8 GW rotated and ongoing asset‑rotation cash ins including ~EUR 230m in February).Repsol Financial Statement Overview
Summary
Financial quality is acceptable but weakening: revenue fell sharply in 2025 and margins compressed versus 2022–2023, while operating cash flow and free cash flow declined. Balance sheet leverage remains moderate, though debt rose and equity dipped in 2025, slightly reducing flexibility.Income Statement
Profitability remains positive in the latest annual period (2025), with net income of ~1.8B and mid-single-digit operating profitability, but earnings power has weakened versus 2022–2023 as margins compressed (gross margin fell to ~13% in 2025 from ~23% in 2022) and revenue declined sharply (about -23% in 2025 after modest declines in 2023–2024). The business has recovered from the 2020 loss year, but the recent downcycle shows meaningful sensitivity to pricing/conditions and less stable year-to-year profitability.56
Neutral
Balance Sheet
Leverage looks moderate for the sector, with debt-to-equity around ~0.53 in 2025 (improved from ~0.77 in 2020) and equity of ~25.1B supporting a ~59.4B asset base. That said, debt increased in 2025 versus 2024 (to ~13.4B from ~12.2B) while equity dipped, which slightly reduces balance-sheet flexibility compared with the prior year despite longer-term improvement since 2020.63
Positive
Cash Flow
Cash generation is positive but trending weaker: operating cash flow was ~4.8B in 2025 (down from ~7.8B in 2022), and free cash flow fell to ~1.16B with a ~-32% decline in 2025. Free cash flow covered only about a quarter of net income in 2025, indicating profitability is translating into cash less efficiently than in 2021–2023, although the company is still producing positive free cash flow.52
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 52.70B | 57.12B | 58.95B | 69.29B | 49.74B |
| Gross Profit | 7.07B | 10.91B | 12.52B | 16.11B | 10.10B |
| EBITDA | 4.93B | 5.61B | 7.25B | 9.93B | 6.74B |
| Net Income | 1.82B | 1.76B | 3.17B | 4.25B | 2.50B |
Balance Sheet | |||||
| Total Assets | 59.40B | 63.19B | 61.63B | 59.96B | 56.25B |
| Cash, Cash Equivalents and Short-Term Investments | 7.98B | 6.43B | 8.43B | 9.01B | 7.84B |
| Total Debt | 13.42B | 12.19B | 10.56B | 13.36B | 14.49B |
| Total Liabilities | 31.80B | 34.09B | 32.56B | 33.99B | 33.46B |
| Stockholders Equity | 22.08B | 26.49B | 26.20B | 25.29B | 22.41B |
Cash Flow | |||||
| Free Cash Flow | 1.16B | 240.00M | 2.22B | 4.30B | 2.77B |
| Operating Cash Flow | 4.76B | 4.96B | 6.51B | 7.83B | 4.68B |
| Investing Cash Flow | -4.76B | -2.69B | -5.85B | -4.10B | -2.93B |
| Financing Cash Flow | -1.23B | -1.64B | -3.05B | -2.83B | -529.00M |
Repsol Technical Analysis
Positive
18.28
Price Trends
19.06
Positive
18.42
Positive
16.54
Positive
Market Momentum
0.66
Negative
71.63
Negative
93.12
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For REPYY, the sentiment is Positive. The current price of 18.28 is below the 20-day moving average (MA) of 19.96, below the 50-day MA of 19.06, and above the 200-day MA of 16.54, indicating a bullish trend. The MACD of 0.66 indicates Negative momentum. The RSI at 71.63 is Negative, neither overbought nor oversold. The STOCH value of 93.12 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for REPYY.
Repsol Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $65.78B | 21.90 | 5.31% | 5.41% | -3.84% | 15.75% | |
71 Outperform | $222.48B | 13.16 | 10.13% | 3.92% | -6.96% | 0.03% | |
70 Outperform | $95.23B | 7.14 | 18.20% | 14.10% | -11.63% | -15.67% | |
68 Neutral | $71.25B | 14.48 | 12.23% | 7.43% | 1.53% | -35.81% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
62 Neutral | $22.69B | 18.24 | 5.00% | 5.18% | -4.83% | -41.69% |
* Energy Sector Average
REPYY
Repsol
21.72
9.35
75.57%
E
Eni SPA
44.12
15.87
56.18%
PBR
Petroleo Brasileiro SA- Petrobras
16.14
2.96
22.47%
SHEL
Shell
79.97
15.65
24.34%
EQNR
Equinor ASA
29.03
7.20
32.98%
TTE
TotalEnergies SE
77.83
19.94
34.44%
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.