The latest update on Ithaca Energy trims the fair value estimate from about £1.93 to about £1.85 per share, mainly reflecting a slightly different balance between risk, tax headwinds and the visibility provided by its hedging program. Alongside a marginal tweak to the discount rate to roughly 7.07% and a higher revenue growth assumption of about 96.85%, the move indicates that expectations are being reshaped rather than rewritten. Stay tuned to see how you can keep on top of these shifting assumptions and what they might mean for Ithaca Energy’s evolving equity story over time.
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🐂 Bullish Takeaways
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Goldman Sachs highlights that Ithaca Energy has a supportive hedging program in 2026, which, in the firm’s view, helps provide some cash flow visibility in the near term.
🐻 Bearish Takeaways
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Goldman Sachs downgraded Ithaca Energy to Sell from Neutral on 20 November 0025 with a price target of 180 GBp, flagging that the shares trade at a premium relative to other names in its coverage, even though the company operates in what the firm describes as an uncompetitive U.K. tax regime.
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The same research points out that cash returns to shareholders have, in its assessment, normalized below peers, which the analyst links back to the valuation and expected shareholder yield from here.
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Goldman Sachs also notes that, beyond the supportive hedging program in 2026, gas hedging from 2027 is limited. The firm frames this as a risk factor for longer term cash flow visibility and, by extension, for how investors may think about the stock’s valuation and growth profile.
Do your thoughts align with the Bull or Bear Analysts? Perhaps you think there’s more to the story. Head to the Simply Wall St Community to discover more perspectives or begin writing your own Narrative!
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Ithaca Energy has agreed a farm-in with Shell UK for a 50% working interest in licences P2629 and P2630 in the West of Shetland basin, which contain the Tobermory gas discovery.
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The company describes the Tobermory farm-in as part of its West of Shetland investment plans and links the move to supporting UK energy security through participation in a key gas hub in the area.
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Once the transaction is complete, Shell UK is expected to retain a 50% stake and remain operator of the Tobermory discovery, with Ithaca Energy holding the other 50%.
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Ithaca Energy also notes that combining the Tobermory farm-in with its existing 50/50 joint venture with Shell in the Tornado discovery further reinforces its role as a partner with Shell in the West of Shetland area.
