Golar LNG (GLNG) Has Long Term LNG Backing, Is The Stock Cheap Enough?

Recent coverage of Golar LNG (GLNG) has focused on its floating liquefaction and regasification activities, supported by 20 year charters and a reported US$17b contracted EBITDA backlog that provides visibility on future cash generation.

Golar LNG’s recent news on long term LNG contracts comes after a softer share price patch, with the stock down 11.29% on a 1 month share price basis and 16.38% over 3 months, even though the year to date share price return is 12.83% and the 5 year total shareholder return sits at 267.08%. This points to long term momentum that has cooled in the short run as investors reassess execution risks and future project timing.

Scan beyond Golar LNG and compare its long-contract profile with a hand-picked 43 power grid technology and infrastructure stocks set to benefit from ongoing investment in critical energy infrastructure.

After a sharp pullback against strong multi year returns and a sizeable long term LNG backlog, does Golar LNG still offer enough upside potential to compensate for execution and project timing risk at today’s price?

Most Popular Narrative: 35% Undervalued

On the analyst consensus Narrative on Simply Wall St, Golar LNG’s fair value sits at $66.31 against a last close of $42.82. This points to a wide gap that this view attempts to explain through contracted LNG capacity, funding choices and execution risk.

The company has secured long term 20 year charters for its existing FLNG units, providing $17b in contracted EBITDA backlog and 20 years of cash flow visibility. This is expected to drive a significant 4x increase in EBITDA and contracted free cash flow by 2028, and the market may still be underestimating how this earnings visibility could support higher revenue and net margins.

See why 28 investors see Golar LNG as 35% undervalued.

Result: Fair Value of $66.31 (UNDERVALUED)

Still, the bullish narrative on Golar LNG hinges on higher cost funding not eroding future earnings and on large FLNG projects being delivered on time and on budget.

Find out about the key risks to this Golar LNG narrative.

Next Steps

Mixed sentiment runs through the Golar LNG story right now, so move quickly, pull up the underlying figures, and decide where you stand. To help pressure test your view against both downside issues and upside factors, start with the 4 key rewards and 2 important warning signs.

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