Investigating Cheniere Energy's Standing In Oil, Gas & Consumable Fuels Industry Compared To Competitors

In today's fast-paced and highly competitive business world, it is crucial for investors and industry followers to conduct comprehensive company evaluations. In this article, we will delve into an extensive industry comparison, evaluating Cheniere Energy LNG in relation to its major competitors in the Oil, Gas & Consumable Fuels industry. By closely examining key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and highlight 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.

Through a meticulous analysis of Cheniere Energy, we can observe the following trends:

• The Price to Earnings ratio of 9.76 is 0.62x lower than the industry average, indicating potential undervaluation for the stock.

• It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 9.34 which exceeds the industry average by 2.93x.

• Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 2.64, which is 1.0x the industry average.

• The company has a higher Return on Equity (ROE) of 20.2%, which is 14.61% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.

• Compared to its industry, the company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.93 Billion, which is 0.21x below the industry average, potentially indicating 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 below the industry average of 9.85%. This suggests a potential struggle in generating increased sales volume.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio is a measure that indicates the level of debt a company has taken on relative to the value of its assets net of liabilities.

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.

In terms of the Debt-to-Equity ratio, Cheniere Energy can be assessed by comparing it to its top 4 peers, resulting in the following observations:

• Cheniere Energy holds a middle position in terms of the debt-to-equity ratio compared to its top 4 peers.

• This indicates a balanced financial structure with a moderate level of debt and an appropriate reliance on equity financing with a debt-to-equity ratio of 5.99.

Key Takeaways

For Cheniere Energy, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB ratio suggests the market values the company's assets highly. The low PS ratio implies a favorable sales valuation. In terms of ROE, Cheniere Energy outperforms peers, reflecting strong profitability. The low EBITDA and gross profit may indicate operational challenges. The low revenue growth suggests a slower expansion rate compared to industry peers.

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