Cheniere Energy Stock Up On Raised EBITDA & DCF Forecast
Zacks Investment Research | Jun 03, 2019 09:19PM ET
Bringing in pleasant news for investors, Cheniere Energy (NYSE:LNG) recently lifted run-rate production and cash flow outlook, as well as authorized a share buyback program. Shares of the company moved up 2.47% to close the session at $64.74 on Jun 3, 2019.
It also made a final investment decision with respect to Train 6 of the Sabina Pass Liquefaction (SPL) project. Construction of the Train 6 will be handed over to contractor Bechtel Oil, Gas and Chemicals, Inc. Notably, SPL Train 5, whose construction was completed a few months back, is set for first commercial delivery in August 2019, under contracts with TOTAL S.A. (NYSE:TOT) and Centrica (LON:CNA) plc.
The largest U.S. liquefied natural gas exporter increased its annual run-rate output guidance to 4.7-5 million tons per annum from 4.5-4.9 million tons on the back of production and maintenance optimization, along with debottlenecking at the SPL project. Taking into account the impact of SPL Train 6 and increased run-rate production guidance, the company has lifted its EBITDA and distributable cash flow guidance for 2019. It now expects adjusted EBITDA and DCF in the band of $5.2-$5.6 billion and $8.40-$9.60 per share, respectively.
Boosting investors’ confidence, Cheniere Energy authorized a stock buyback program of $1 billion over the next three years. Given first-mover advantage in the LNG export market, the firm is primed for significant revenue and earnings growth.Importantly, the Zacks Rank #3 (Hold) company currently exports to around 30 countries worldwide, as the firm aims at turning the natural gas glut in the United States into export revolution. Cheniere Energy looks well positioned to maintain revenue growth trajectory over the coming years, backed by solid operations and long-term contracts. You can see Zacks Investment Research
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