In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Cheniere Energy LNG and its primary competitors in the Oil, Gas & Consumable Fuels industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within 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 | 9.52 | 9.12 | 2.58 | 20.2% | $1.93 | $1.7 | -20.75% |
| Enterprise Products Partners LP | 11.11 | 2.26 | 1.16 | 5.0% | $2.31 | $1.72 | 26.59% |
| Williams Companies Inc | 19.68 | 4.54 | 5.34 | 3.25% | $1.43 | $1.35 | -5.92% |
| Energy Transfer LP | 13.49 | 1.60 | 0.63 | 3.37% | $4.19 | $3.91 | 13.15% |
| ONEOK Inc | 20.16 | 3.19 | 2.64 | 4.71% | $1.58 | $1.74 | 31.14% |
| Kinder Morgan Inc | 20.27 | 1.62 | 3.20 | 1.88% | $1.58 | $2.02 | 2.03% |
| MPLX LP | 10.79 | 3.32 | 4.20 | 8.65% | $1.74 | $1.19 | 7.53% |
| Targa Resources Corp | 31.16 | 13.14 | 2.04 | 11.54% | $0.98 | $1.02 | 4.65% |
| Western Midstream Partners LP | 9.89 | 4.43 | 4.27 | 11.34% | $0.64 | $0.69 | 22.67% |
| Plains All American Pipeline LP | 15.65 | 1.19 | 0.24 | 1.75% | $0.76 | $0.47 | 11.47% |
| DT Midstream Inc | 18.95 | 1.82 | 7.99 | 2.3% | $0.23 | $0.19 | 8.93% |
| Antero Midstream Corp | 18.81 | 3.41 | 6.37 | 4.02% | $0.22 | $0.18 | 4.17% |
| EnLink Midstream LLC | 48.37 | 7.29 | 0.97 | 4.2% | $0.31 | $0.33 | 2.18% |
| Frontline PLC | 8.56 | 2.10 | 2.64 | 7.81% | $0.27 | $0.22 | 8.44% |
| Ultrapar Participacoes SA | 8.26 | 1.61 | 0.18 | 3.12% | $1.49 | $2.11 | 9.3% |
| Hess Midstream LP | 15.33 | 7.90 | 1.78 | 11.39% | $0.28 | $0.31 | 12.7% |
| Hafnia Ltd | 4.59 | 1.50 | 1.24 | 10.64% | $0.33 | $0.47 | 18.58% |
| Plains GP Holdings LP | 22.56 | 2.45 | 0.07 | 2.59% | $0.74 | $0.82 | 11.47% |
| Scorpio Tankers Inc | 5.57 | 1.24 | 2.65 | 8.0% | $0.31 | $0.25 | 15.6% |
| TORM PLC | 4.38 | 1.59 | 1.91 | 9.46% | $0.26 | $0.28 | 13.9% |
| Transportadora de Gas del Sur SA | 25.50 | 1.58 | 5.21 | 5.63% | $178.98 | $147.88 | 25.83% |
| International Seaways Inc | 4.92 | 1.34 | 2.49 | 7.86% | $0.2 | $0.14 | -11.91% |
| Average | 16.1 | 3.29 | 2.72 | 6.12% | $9.47 | $7.97 | 11.07% |
By closely studying Cheniere Energy, we can observe the following trends:
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The Price to Earnings ratio of 9.52 is 0.59x lower than the industry average, indicating potential undervaluation for the stock.
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With a Price to Book ratio of 9.12, which is 2.77x the industry average, Cheniere Energy might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
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Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 2.58, which is 0.95x the industry average.
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With a Return on Equity (ROE) of 20.2% that is 14.08% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
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Compared to its industry, the company has lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.93 Billion, which is 0.2x below the industry average, potentially indicating lower profitability or financial challenges.
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With lower gross profit of $1.7 Billion, which indicates 0.21x below the industry average, the company may experience lower revenue after accounting for production costs.
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The company is witnessing a substantial decline in revenue growth, with a rate of -20.75% compared to the industry average of 11.07%, which indicates a challenging sales environment.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.
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.
By considering the Debt-to-Equity ratio, Cheniere Energy can be compared to its top 4 peers, leading to the following observations:
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Cheniere Energy falls in the middle of the list when considering the debt-to-equity ratio.
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This indicates that the company has a moderate level of debt relative to its equity with a debt-to-equity ratio of 5.99, suggesting a balanced financial structure with a reasonable debt-equitymix.
Key Takeaways
For Cheniere Energy in the Oil, Gas & Consumable Fuels industry, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB ratio suggests a premium on the company's book value. 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 indicate room for improvement in operational efficiency. 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.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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