LNG

Cheniere Energy — Overvalued and Deeply Indebted

Cheniere Energy logged a 0.2% change during today's morning session, and is now trading at a price of $145.07 per share. The S&P 500 index moved 0.9% and the Nasdaq posted a 0.8% change. LNG's trading volume is 346,610 compared to the stock's average volume of 2,181,822.

Cheniere Energy shares moved 33.4% over the last 52 weeks, with a high of $182.35 and a low of $100.13. During this time, the stock underperformed the S&P 500 index by 52.0%. As of January 2022, the company's 50-day average price is $165.0. Cheniere Energy, Inc., an energy infrastructure company, primarily engages in the liquefied natural gas (LNG) related businesses in the United States. The large-cap Energy company has 1,550 full time employees and is based in Houston, TX. Cheniere Energy has returned a 1.0% dividend yield over the last 12 months.

Snapshot of the Company's Exceptionally High Debt Levels:

2019-12-31 2020-12-31 2021-12-31
Revenue (MM) $9,730 $9,358 $15,864
Revenue Growth n/a -3.82% 69.52%
Gross Margins 39.6% 45.6% 6.8%
Gross Margins Growth n/a 15.15% -85.09%
Operating Margins 24.5% 28.2% -4.4%
Operating Margins Growth n/a 15.1% -115.6%
Earnings Per Share $2.51 -$0.34 -$9.25
EPS Growth n/a -113.55% -2620.59%
Free Cash Flow (MM) -$1,223 -$574 $1,503
FCF Growth n/a 53.07% 361.85%
Capital Expenditures (MM) -$3,056 -$1,839 -$966
Net Debt / EBITDA 9.09 8.52 98.8

Cheniere Energy Is Overvalued:

Compared to the Energy sector's average of 9.11, Cheniere Energy has a trailing twelve month price to earnings (P/E) ratio of -10.2 and, based on its EPS guidance of 20.71, an expected P/E ratio of 7.0.

The firm's price to earnings growth (PEG) is -2.72, because its current P/E ratio is negative — so in this case the PEG ratio is not a meaningful indicator of the company's valuation.

Cheniere Energy Benefits From Positive Market Indicators:

21 analysts are following Cheniere Energy and have set target prices ranging from $187 to $245 per share. On average, they have given the company a rating of buy. At the current price of $145.07, LNG is trading -30.22% away from its average analyst target price of $207.9 per share, implying an analyst consensus of strong upside potential for the stock.

The company has a very low short interest since 1.6% of the company's shares are tied to short positions. Institutions own 87.6% of Cheniere Energy's shares, while the insider ownership rate stands at 0.74%. The biggest shareholder is the Vanguard Group, Inc. with a 9% stake in the company worth approximately $3,406,142,505.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

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