Reasons for optimism on margins after major Offshore intake, but shares up with events After solid 3Q22 results, major order wins in the higher-margin Offshore divisions and significant growth in the 18-month EandC project bidding pipeline, Saipem''s recovery is off to a flying start. While we acknowledge the progress made, we think investors will look for proof of good execution and a more disciplined approach to bidding, particularly in Onshore EandC, before the shares can re-rate further after having doubled in the last 3 months. We remain Neutral but materially raise our target price to EUR1.45/sh (from EUR0.7/sh) on upgraded ''22 guidance, major recent orders in Offshore EandC and Drilling and improved potential for margin expansion. Well positioned for spending hot spots - 10% CAGR in Offshore divisions'' top line ''22-25e As outlined in our recent sector note, we saw a positive outlook for offshore OandG development capex driven by comparatively low breakevens and attractive CO2 emissions profiles. We think SPM is well positioned to capture much of the increase in spend, driving 10% CAGR in Offshore EandC topline over 2022-25e and c10% in Offshore Drilling: (1) deepwater oil, e.g. in Guyana with XOM, (2) Middle East conventional, where Aramco and Adnoc have announced multi-year capex increases and (3) offshore gas, with visible prospects in Africa, Turkey, the Black Sea and potential trunkline work. More subdued outlook in Onshore EandC Risks in Onshore EandC remain, with the path back to mid-single digit margins requiring both solid execution and selective order intake. LNG and downstream opportunities offer differentiated margins, but visibility on near-term opportunities is limited. Shares no longer ''stand out cheap'' on 6.4x ''23 EV/EBITDA, with risk reward balanced SPM has outperformed its closest peers SUBC and FTI by 75% in the last three months, with the shares now trading in line at 6.4x ''23E EBITDA and 4.3x ''24E EBITDA. We remain bullish on...