In the fast-paced and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Cheniere Energy LNG in comparison to its major competitors within the Oil, Gas & Consumable Fuels industry. By analyzing crucial 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 | 9.70 | 9.28 | 2.62 | 20.2% | $1.93 | $1.7 | -20.75% |
| Energy Transfer LP | 13.16 | 1.56 | 0.62 | 3.37% | $4.19 | $3.91 | 13.15% |
| Williams Companies Inc | 18.65 | 4.30 | 5.06 | 3.25% | $1.43 | $1.35 | -5.92% |
| ONEOK Inc | 18.81 | 2.97 | 2.46 | 4.71% | $1.58 | $1.74 | 31.14% |
| Kinder Morgan Inc | 19.28 | 1.54 | 3.04 | 1.88% | $1.58 | $2.02 | 2.03% |
| MPLX LP | 9.89 | 3.05 | 3.85 | 8.65% | $1.74 | $1.19 | 7.53% |
| Targa Resources Corp | 28.57 | 12.05 | 1.87 | 11.54% | $0.98 | $1.02 | 4.65% |
| Western Midstream Partners LP | 10.23 | 4.59 | 4.42 | 11.34% | $0.64 | $0.69 | 22.67% |
| Plains All American Pipeline LP | 15.57 | 1.18 | 0.24 | 1.75% | $0.76 | $0.47 | 7.82% |
| DT Midstream Inc | 17.69 | 1.70 | 7.46 | 2.3% | $0.23 | $0.19 | 8.93% |
| Antero Midstream Corp | 17.31 | 3.13 | 5.86 | 4.02% | $0.22 | $0.18 | 4.17% |
| EnLink Midstream LLC | 39.80 | 6 | 0.80 | 4.2% | $0.31 | $0.33 | 2.18% |
| Frontline Plc | 8.06 | 2.16 | 2.73 | 7.77% | $0.34 | $0.22 | 16.3% |
| Ultrapar Participacoes SA | 9.29 | 1.81 | 0.20 | 3.12% | $1.49 | $2.11 | 9.3% |
| Scorpio Tankers Inc | 5.81 | 1.35 | 2.76 | 8.0% | $0.31 | $0.25 | 15.6% |
| Hafnia Ltd | 4.77 | 1.70 | 1.42 | 7.97% | $0.24 | $0.68 | 74.09% |
| Plains GP Holdings LP | 19.19 | 0.35 | 0.17 | 4.24% | $0.76 | $0.82 | 7.82% |
| TORM PLC | 4.65 | 1.69 | 2.08 | 11.22% | $0.27 | $0.29 | 13.81% |
| Hess Midstream LP | 15.44 | 6.99 | 1.79 | 11.39% | $0.28 | $0.31 | 12.7% |
| Transportadora de Gas del Sur SA | 46.79 | 1.99 | 5.91 | 5.06% | $120.58 | $88.44 | 6.15% |
| New Fortress Energy Inc | 11.02 | 1.71 | 1.12 | 3.27% | $0.2 | $0.38 | 19.2% |
| International Seaways Inc | 4.68 | 1.29 | 2.37 | 7.86% | $0.2 | $0.14 | -11.91% |
| Average | 16.13 | 3.01 | 2.68 | 6.04% | $6.59 | $5.08 | 12.45% |
Upon a comprehensive analysis of Cheniere Energy, the following trends can be discerned:
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The stock's Price to Earnings ratio of 9.7 is lower than the industry average by 0.6x, suggesting potential value in the eyes of market participants.
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The elevated Price to Book ratio of 9.28 relative to the industry average by 3.08x suggests company might be overvalued based on its book value.
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The Price to Sales ratio is 2.62, which is 0.98x the industry average. This suggests a possible undervaluation based on sales performance.
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The Return on Equity (ROE) of 20.2% is 14.16% 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 0.29x below the industry average, suggesting potential lower profitability or financial challenges.
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The company has lower gross profit of $1.7 Billion, which indicates 0.33x below the industry average. This potentially indicates 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 12.45%. This indicates a potential fall in the company's sales performance.
Debt To Equity Ratio
The debt-to-equity (D/E) ratio assesses the extent to which a company relies on borrowed funds compared to its equity.
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:
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When compared to its top 4 peers, Cheniere Energy has a moderate debt-to-equity ratio of 5.99.
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This implies that the company maintains a balanced financial structure with a reasonable level of debt and an appropriate reliance on equity financing.
Key Takeaways
For Cheniere Energy, the PE ratio is low compared to peers, indicating potential undervaluation. The PB ratio is high, suggesting investors are willing to pay a premium for its assets. The PS ratio is low, signaling 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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