Metlen Energy & Metals’ new guidance for 2026 is exactly in line with market expectations, according to Morgan Stanley, which maintains its “outperform” rating and a price target of €55 per share.
Based on the closing price of €38.24 on May 20, the firm sees significant upside potential of over 40%, but the key factor for the next phase is not just operating profits; it is free cash flow generation.
Metlen projected an EBITDA range of €1 billion to €1.15 billion in 2026, with the midpoint of the range at €1.075 billion. This level is essentially in line with the market consensus of €1.08 billion and Morgan Stanley’s estimate of €1.07 billion. Ioannis Masvoulis, Adahna Ekoku, Alain Gabriel, and the Morgan Stanley team note that the announcement provides confirmation of the profitability trajectory following the pressures of 2025, while the company remains committed to its medium-term target of €2 billion in EBITDA.
Morgan Stanley estimates that the key catalysts for a re-rating of the stock are shifting to the second half of the year. The first concerns the possibility of free cash flow turning positive, and the second the completion of the challenging MPP projects. The divergence from the consensus is significant, as the firm forecasts free cash flow before acquisitions and mergers at €90 million in 2026, compared to negative market estimates of €200 million to €300 million.
For 2026, Morgan Stanley forecasts revenue of €9.73 billion, EBITDA of €1.07 billion, and net profit of €565 million. Earnings per share are estimated at €3.85, up from €2.20 in 2025, rising to €5.23 in 2027 and €6.58 in 2028. The P/E ratio declines from 9.9x in 2026 to 7.3x in 2027 and 5.8x in 2028, with the dividend yield rising from 3.5% to 4.7% and 5.9%, respectively.