Insights Into Cheniere Energy's Performance Versus Peers In Oil, Gas & Consumable Fuels Sector

Benzinga · 10/15 15:01

Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating Cheniere Energy (NYSE:LNG) in comparison to its major competitors within the Oil, Gas & Consumable Fuels industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of company's performance in the industry.

Cheniere Energy Background

Cheniere Energy owns and operates the Sabine Pass liquefied natural gas terminal via its stake in Cheniere Partners. It also owns the Corpus Christi LNG terminals as well as Cheniere Marketing, which markets LNG using Cheniere's gas volumes.

Company P/E P/B P/S ROE EBITDA (in billions) Gross Profit (in billions) Revenue Growth
Cheniere Energy Inc 9.99 9.57 2.70 20.2% $1.93 $1.7 -20.75%
Enterprise Products Partners LP 11.26 2.29 1.18 5.0% $2.31 $1.72 26.59%
Williams Companies Inc 21.99 5.07 5.97 3.25% $1.43 $1.35 -5.92%
ONEOK Inc 21.57 3.41 2.83 4.71% $1.58 $1.74 31.14%
Energy Transfer LP 13.91 1.65 0.65 3.37% $4.19 $3.91 13.15%
Kinder Morgan Inc 22.83 1.82 3.60 1.88% $1.58 $2.02 2.03%
MPLX LP 10.70 3.30 4.16 8.65% $1.74 $1.19 7.53%
Targa Resources Corp 35.09 14.80 2.29 11.54% $0.98 $1.02 4.65%
Western Midstream Partners LP 10.19 4.57 4.40 11.34% $0.64 $0.69 22.67%
Plains All American Pipeline LP 15.92 1.21 0.25 1.75% $0.76 $0.47 11.47%
DT Midstream Inc 20.81 2 8.77 2.3% $0.23 $0.19 8.93%
Antero Midstream Corp 19.46 3.52 6.59 4.02% $0.22 $0.18 4.17%
EnLink Midstream LLC 49 7.39 0.99 4.2% $0.31 $0.33 2.18%
Frontline PLC 8.69 2.13 2.68 7.81% $0.27 $0.22 8.44%
Ultrapar Participacoes SA 8.17 1.60 0.18 3.12% $1.49 $2.11 9.3%
Hess Midstream LP 15.76 8.12 1.83 11.39% $0.28 $0.31 12.7%
Plains GP Holdings LP 22.90 2.49 0.07 2.59% $0.74 $0.82 11.47%
Hafnia Ltd 4.54 1.49 1.22 10.64% $0.33 $0.47 18.58%
Scorpio Tankers Inc 5.44 1.21 2.59 8.0% $0.31 $0.25 15.6%
Transportadora de Gas del Sur SA 29.38 1.82 6 5.63% $178.98 $147.88 25.83%
TORM PLC 4.01 1.46 1.75 9.46% $0.26 $0.28 13.9%
International Seaways Inc 4.83 1.32 2.45 7.86% $0.2 $0.14 -11.91%
New Fortress Energy Inc 8.18 1.56 0.83 -5.57% $0.02 $0.16 -23.75%
Average 16.57 3.37 2.79 5.59% $9.04 $7.61 9.49%

By conducting a comprehensive analysis of Cheniere Energy, the following trends become evident:

  • A Price to Earnings ratio of 9.99 significantly below the industry average by 0.6x suggests undervaluation. This can make the stock appealing for those seeking growth.

  • It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 9.57 which exceeds the industry average by 2.84x.

  • With a relatively low Price to Sales ratio of 2.7, which is 0.97x the industry average, the stock might be considered undervalued based on sales performance.

  • The Return on Equity (ROE) of 20.2% is 14.61% above the industry average, highlighting efficient use of equity to generate profits.

  • The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.93 Billion is 0.21x below the industry average, suggesting potential lower profitability or financial challenges.

  • The gross profit of $1.7 Billion is 0.22x below that of its industry, suggesting potential lower revenue after accounting for production costs.

  • The company's revenue growth of -20.75% is significantly lower compared to the industry average of 9.49%. This indicates a potential fall in the company's sales performance.

Debt To Equity Ratio

debt to equity

The debt-to-equity (D/E) ratio indicates the proportion of debt and equity used by a company to finance its assets and operations.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

When assessing Cheniere Energy against its top 4 peers using the Debt-to-Equity ratio, the following comparisons can be made:

  • In the context of the debt-to-equity ratio, Cheniere Energy holds a middle position among its top 4 peers.

  • This indicates a moderate level of debt relative to its equity with a debt-to-equity ratio of 5.99, which implies a relatively balanced financial structure with a reasonable debt-equity mix.

Key Takeaways

The low P/E ratio of Cheniere Energy suggests that the company's stock price is relatively inexpensive compared to its earnings. However, the high P/B ratio indicates that the stock may be overvalued based on its book value. The low P/S ratio implies that the company's stock price is attractive relative to its revenue. On the other hand, the high ROE, low EBITDA, low gross profit, and low revenue growth of Cheniere Energy may raise concerns about its financial performance compared to its industry peers in the Oil, Gas & Consumable Fuels sector.

This article was generated by Benzinga's automated content engine and reviewed by an editor.