Don’t Get Caught in a Gas Bubble, But Cheniere Energy Stock Is Hot

• Cheniere Energy (LNG) demonstrates strong price momentum, hitting an all-time high in October.
• Shares are up more than 40% over the past 52 weeks.
• LNG maintains a 100% technical “Buy” rating from Barchart.
• Wall Street sentiment is optimistic, with most analysts rating LNG a “Strong Buy.” 

Today’s Featured Stock

Valued at $63.5 billion Cheniere Energy (LNG) is primarily engaged in businesses related to liquefied natural gas (or LNG).

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals and superior current momentum. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. LNG checks those boxes. The Trend Seeker issued a new “Buy” signal on Oct. 13. Since that signal, LNG is up 4.14%.

Barchart’s Technical Indicators for Cheniere Energy

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Cheniere Energy hit an all-time high of $330.73 Oct. 30.

• Cheniere Energy has a Weighted Alpha of 42.32.
• LNG has a 100% “Buy” opinion from Barchart.
• The stock has gained 43.56% over the past 52 weeks.
• Cheniere Energy has its Trend Seeker “Buy” signal intact.
• The stock recently traded at $295.12 with a 50-day moving average of $283.74.
• LNG had 15 highs and gained 9.95% in the last month.
• 60-month beta of 0.01.
• Relative Strength Index (RSI) is at 51.25.
• There’s a technical support level around $304.37.

Don’t Forget the Fundamentals

• $63.5 billion market capitalization.
• 21.83x trailing price-earnings ratio.
• 0.84% dividend yield.
• Revenue is expected to grow 16.60% this year and another 0.91% next year.
• Earnings are estimated to increase 95.82% this year but decrease by 1.44% next year.

Analyst and Investor Sentiment on Cheniere Energy

• Wall Street analysts followed by Barchart give the stock 17 “Strong Buy,” 2 “Moderate Buy,” and 2 “Hold” opinions with price targets from $255 to $377.
• Value Line rates the stock “Highest” with price targets between $110 and $315.
• Morningstar thinks the stock is 13% overvalued with a fair value of $275.
• 65,670 investors are following the stock on Seeking Alpha, which rates it a “Hold.”
• TipRanks’ analysts have a consensus price target of $334.94.
• Short interest is 2.28% of the float with 3.07 days to cover.

The Bottom Line on Cheniere Energy

The stock displays impressive profitability and strong price momentum, while valuation remains extremely stretched compared to peers. Growth is only moderate, but upward revisions from Wall Street analysts suggest some optimism for future results. Energy stocks have been getting a lot of press lately. Please make sure you are diversified and not overly concentrated in that sector. Have a stop loss in place.

Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio, it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.

On the date of publication, Jim Van Meerten did not directly have a position in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.