JP Morgan cites Saipem as 'Top Pick' in shifting commodity market

** JP Morgan cited Italy's Saipem SPM as a top pick among European oil explorers and resumes its coverage, while highlighting "resilient winners" in a turbulent and short-term market geopolitical context

** The broker highlights companies with high revenue visibility, geographical advantage, and in Saipem's case, a EBITDA margin recovery and pending strengthening of pricing power in wake of its Subsea 7 merger

** "The sector has seen revenue-led absolute EBITDA growth, with margins recovering to varying extents. Given the upstream capex backdrop, we expect margin expansion to step in as the next primary growth driver," said a note by JPM

** Another "Top Pick" the bank identified is UK's Harbour Energy HBR due to its "scale-driven cost reductions and resilient 2026 FCF (free cash flow)"

** Both Saipem and Harbour Energy are rated "Overweight" together with Technip Energies TE, while Norway's Aker Solutions AKSO is rated as "Underweight" due to JPM's preference of oil field services over exploration and production