$SASOF

Sasol, the South African energy and chemicals company, said in a trading statement it expects FY earnings per share of R17.50 to R19.50, up 65% to 84% from R10.60 a year earlier, as oil and fuel prices rose after US and Israel strikes on Iran and Strait of Hormuz disruptions. Adjusted EBITDA is forecast at R58-62 billion versus R51.8 billion.

Sasol Ltd. said it has agreed with China’s Envision to run a front-end engineering and design (FEED) study for a renewable-powered green hydrogen project at Sasolburg, supported by South Africa’s Industrial Development Corporation. The study, led by Envision, will assess technical and commercial feasibility for e-methanol and possibly sustainable aviation fuel, due by Oct 2026.

Sasol said it expects EBITDA of up to R62 billion for the year ended June 30, up from R52 billion a year earlier, citing higher fuel prices linked to the Iran war. CEO Simon Baloyi highlighted increased coal-to-liquids and refinery output, renewable buildout, and a 30% emissions cut by 2030. Sasol’s Oryx gas-to-liquids output was halted after the conflict began.

Sasol said it expects headline EPS to rise 2% to 14% for the year to June, after R22.4bn in the prior year, as profit gains from higher volumes offset easing writedowns. Adjusted EBITDA is forecast at R58bn to R62bn, up to 20%, helped by a 4% volume rise and improved fuel differentials. Impairments before tax are expected at R16.8bn. Full-year results are due 1 Sep.

Analyst estimates for Sasol Ltd. show the 12-month average price target increased from $14.21 to $14.45, based on 8 analysts. Targets range from $9.79 to $27.81. Using the Jul. 22 closing price, the update implies about 28% upside. The consensus rating remains “Buy” (3 Buys, 4 Holds, 1 Sell).

Sasol said its Secunda plant produced its highest annual output in five years after its coal-destoning facility improved coal quality. The company expects performance to stay within or above guidance and said 2026 results are supported by stronger output and a better macro backdrop. Chemicals and energy units also beat expectations. Full-year results are due Sept. 1.

Sasol published FY26 business performance metrics for the year ended 30 June 2026, citing safety improvements and higher liquid fuels sales volumes, with earnings supported by stronger refining margins but partly offset by crude oil hedging losses. International Chemicals adjusted EBITDA is expected to exceed US$375-450 million guidance. Updates include NERSA gas price application, Augusta Italy paraffin restart, and renewable capacity expansion.

Sasol Limited saw a sharp drop in short interest in May, according to reported exchange data. Short interest fell to 7,346 shares as of May 15, down 95.8% from 173,455 shares on April 30. With average daily volume of 64 shares, the short-interest ratio is 114.8 days. The stock was flat at $13.23.

Sasol shares have doubled in 2024, helped by higher oil prices after the Iran conflict, with Brent up 36% since the start of the war. Bloomberg data show only two buy ratings remain out of nine after downgrades by Nedbank and Citigroup. Analysts cite limited upside, carbon liabilities from coal-heavy operations, and risks around Secunda’s value and potential terminal decline.

Sasol (SSL) is presented as a strong candidate for value investors, currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A. The article highlights its attractive valuation metrics, such as a P/E ratio of 3.51 compared to an industry average of 10.47, and a PEG ratio of 0.35 against an industry average of 0.69. These indicators suggest Sasol is likely undervalued with a strong earnings outlook.