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 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:
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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.
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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.
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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.
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The Return on Equity (ROE) of 20.2% is 14.61% above the industry average, highlighting efficient use of equity to generate profits.
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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.
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The gross profit of $1.7 Billion is 0.22x below that of its industry, suggesting potential lower revenue after accounting for production costs.
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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
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:
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In the context of the debt-to-equity ratio, Cheniere Energy holds a middle position among its top 4 peers.
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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.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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