Following the initiation of coverage of the company in November, Euroxx updates the model and forecasts for Motor Oil to reflect:
- the unprecedented product cracks that shape the current refining margin environment, as a result of the limited supply of refined products, and
- the recalibration of the Group's non-fuel activities.
In the second quarter of 2026, Motor Oil recorded the strongest quarter in its history and we expect this trend to continue in the coming quarters, with adjusted EBITDA reaching €2.1 billion, the analysts note.
We have updated our valuation and set a new target price at €70.8 per share, from €36.3 previously, maintaining the overweight recommendation. Based on our estimates, Motor Oil is trading at EV/EBITDA of 4.0x for 2027 and 4.2x for 2028.
We have upgraded our estimates to reflect a higher refining margin environment from the third quarter onward, now forecasting a refining margin of $25.7/barrel for the year, with the Group's adjusted EBITDA exceeding the €2 billion threshold.
The new forecasts also reflect revenues and adjustments linked to deal flow and originating from Renewable Energy Sources, while at the same time we are revising our forecasts for the circular economy from 2027 onwards.
As a result, we forecast fairly strong free cash flow generation (yield of about 14.6% in 2026E), despite the build-up of working capital due to cargoes during the first half of 2026, with the momentum largely being maintained in 2027 as well, they add.