Bank of America Securities (BofA) has reportedly reinstated coverage of the stock with a ‘Buy’ rating and a price target of $215.
Liquefied natural gas producer Cheniere Energy Inc ($LNG), was in focus on Thursday after it reportedly received permission for a supply line.
According to a Reuters report, the Federal Energy Regulatory Commission issued an order that permits Cheniere to take LNG from the plant to refrigerated liquid storage facilities and then onto a tanker for export.
Moreover, Bank of America Securities (BofA) has reportedly reinstated coverage of the stock with a ‘Buy’ rating and a price target of $215. The brokerage finds Cheniere attractive given its 90% contracted cash flows, near-term marketing upside, and free cash flow growth via low cost expansions at its Sabine Pass and Corpus Christi facilities.
Cheniere is BofA’s top energy pick. The brokerage reportedly stated that its expansion at Sabine Pass, which is not included in its valuation, could provide a potential upside of $15/share.
The company has one of the largest liquefaction platforms in the world, consisting of the Sabine Pass and Corpus Christi facilities on the U.S. Gulf Coast. Its total production capacity stands at approximately 45 million tons per annum (mtpa) of LNG in operation and an additional 10+ mtpa of expected production capacity under construction.
Following the barrage of positive news, retail sentiment on Stocktwits flipped into the ‘extremely bullish’ territory (88/100), accompanied by ‘extremely high’ message volumes.
Despite the optimism surrounding the firm, the stock failed to record any gains on Thursday. Notably, its year-to-date returns at over 7% has been unimpressive against the benchmark U.S. indices’ performance this year.
The firm is scheduled to report its third-quarter earnings on Oct. 31, 2024 before the opening bell.
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