Goldman Sachs Energy, Utilities & Mining Pulse — Investor Questions: Where Can We See Positive Momentum in Q3 Results and Q4 Guidance?
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Abstract
Goldman Sachs surveys momentum across energy, utilities and mining heading into third-quarter earnings amid macro uncertainty. XLE is up 46% year-to-date, but performance is split: refining and E&P lead while utilities and cleantech lag, focusing investors on names with idiosyncratic drivers. Cenovus Energy shows positive pre-print momentum on strong oil sands output and elevated U.S. refining margins, with West White Rose set to add production in Q4 and 2027. Venture Global has roughly 27% of 2027 LNG capacity uncontracted and could see 2027 EBITDA about 37% above consensus at current spot margins. Permian Resources has outperformed covered E&Ps with a 59% year-to-date gain, helped by Waha gas prices improving from roughly negative $3.95/MMBtu in Q2 to above $1.25/MMBtu in Q3. Talen Energy benefits from strengthening PJM power prices and potential data center power purchase agreements. Shoals Technologies is converting backlog faster than expected, with $700 million of its $801 million backlog expected to convert within four quarters. Steel Dynamics' aluminum expansion is on track, with all three cold-roll lines running and initial automotive shipments due in Q4.
Ratings: Talen (TLN) Buy, target price $509; Shoals (SHLS) Buy, target price $13; Steel Dynamics (STLD) Buy, target price $299.
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