FLEX LNG (FLNG) AI Stock Analysis

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FLEX LNG

(NYSE:FLNG)

Rating:72Outperform

Price Target:―

FLEX LNG's overall score reflects its solid financial performance and attractive valuation, bolstered by a strong earnings call. However, technical indicators suggest caution due to potential overbought conditions, and ongoing market and regulatory challenges could impact future performance.

Positive Factors

Dividend Strength

FLNG's high contract coverage provides strong cash flow visibility which should continue to fund the dividend.

Earnings Performance

Flex LNG reported an overall 2Q beat, as the termination of the back end of an interest rate swap pushed earnings above expectations.

Financial Stability

Flex declared its usual dividend of $0.75/sh and announced it had received credit approval for the refinancing of 3 ships for $430 million, unlocking $97 million in cash.

Negative Factors

Market Conditions

EU gas inventories are currently sitting at all-time highs for this point in the year at ~95% full, creating an additional overhang for LNG carrier rates.

Spot Rate Pressure

Limited spot cargoes across both Atlantic and Pacific basins is putting downward pressure on spot rates.

FLEX LNG (FLNG) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$1.25B

Dividend Yield12.7%

Average Volume (3M)318.51K

Price to Earnings (P/E)12.4

Beta (1Y)0.48

Revenue Growth-3.95%

EPS Growth-2.25%

CountryUS

Employees9

SectorEnergy

Sector Strength48

IndustryOil & Gas Midstream

Share Statistics

EPS (TTM)0.54

Shares Outstanding54,087,770

10 Day Avg. Volume371,365

30 Day Avg. Volume318,506

Financial Highlights & Ratios

PEG Ratio0.57

Price to Book (P/B)1.92

Price to Sales (P/S)0.00

P/FCF Ratio7.91

Enterprise Value/Market Cap2.49

Enterprise Value/Revenue2.15

Enterprise Value/Gross Profit15.04

Enterprise Value/Ebitda2.75

Forecast

1Y Price Target

$25.00

Price Target Upside5.40% Upside

Rating ConsensusHold

Number of Analyst Covering1

FLEX LNG Business Overview & Revenue Model

Company DescriptionFLEX LNG (FLNG) is a shipping company that specializes in the transportation of liquefied natural gas (LNG). Operating within the energy sector, the company owns and operates a fleet of LNG carriers, leveraging cutting-edge technology to ensure efficient and reliable delivery of LNG worldwide. FLEX LNG's business model is centered around providing charter services to major energy companies, ensuring safe and timely transport of LNG to various global destinations.

How the Company Makes MoneyFLEX LNG makes money primarily through long-term time charter agreements with energy companies and traders who require transportation of LNG. These contracts provide a steady stream of revenue, as customers pay a fixed daily rate to use FLEX LNG's vessels over an agreed period. The company also engages in spot market charters, which offer higher rates when demand for LNG shipping capacity spikes. Additionally, the company's earnings are influenced by partnerships with major energy producers and traders who depend on FLEX LNG's modern fleet for efficient and reliable LNG transport.

FLEX LNG Earnings Call Summary

Earnings Call Date:May 21, 2025

(Q1-2025)

% Change Since: 0.25%|

Next Earnings Date:Aug 29, 2025

Earnings Call Sentiment Positive

Flex LNG reported solid financial results and maintained a strong balance sheet, despite challenges in the spot market and global LNG import environment. The company's long-term outlook remains positive, bolstered by a strong contract backlog and cash position.

Q1-2025 Updates

Positive Updates

Strong Adjusted Net Income

Flex LNG reported $29.4 million in adjusted net income for Q1 2025, implying $0.54 in adjusted earnings per share.

Solid Contract Backlog

The company secured up to 88 years of contract backlog, providing a robust foundation for future revenue.

Fortress Balance Sheet

Flex LNG maintains a strong balance sheet with $410 million in cash and minimal CapEx liabilities.

Successful Balance Sheet Optimization

Initiation of balance sheet optimization program 3.0 to release an additional $120 million in free cash.

High Dividend Yield

The Board declared a $0.75 per share quarterly dividend, bringing the trailing 12-month dividend to $3 per share or a yield of 12%.

Positive Long-Term LNG Market Outlook

Flex LNG is well-positioned to benefit from increasing LNG export volumes expected between 2028 and 2030.

ESG Achievements

Released the seventh ESG report with a B score for CDP rating and zero lost time injury frequency in 2024.

Negative Updates

Seasonal Lower Spot Market

Reduction in revenues due to a seasonal lower spot market impacting the variable hire contract for Flex Artemis.

Interest Rate Volatility

Net loss of $7.3 million on the derivative portfolio due to significant interest rate market volatility.

Challenging LNG Import Environment

LNG imports to China dropped by 24%, and India showed flattish growth compared to last year's double-digit growth.

Company Guidance

In the first quarter of 2025, Flex LNG reported strong financial results, with $29.4 million in adjusted net income and $0.54 in adjusted earnings per share. The company maintained its full-year revenue guidance of $340 million to $360 million, with an expected TCE of $72,000 to $77,000 per day. EBITDA is projected to be between $250 million and $270 million. The Board declared a $0.75 per share dividend, leading to a 12% yield over the last 12 months. Flex LNG's balance sheet remains robust, with $410 million in cash and a solid contract backlog of 59 years, potentially increasing to 88 years if all options are exercised. The company is optimizing its balance sheet to free up $120 million in cash, with plans for refinancing initiatives, including securing a JOLCO financing for Flex Courageous. Despite a soft spot market, Flex LNG's long-term outlook is positive, with strong demand anticipated for LNG shipping driven by new U.S. and Qatar projects.

FLEX LNG Financial Statement Overview

Summary

FLEX LNG demonstrates robust financial health with strong profitability and a stable balance sheet. While cash flow management poses some challenges, the company maintains solid financial metrics that support its operations and growth in the fossil fuels industry.

Income Statement

Positive

FLEX LNG shows strong profitability with a stable gross profit margin and EBIT margin over the years. However, the net income has been fluctuating, indicating potential volatility. Revenue growth is inconsistent but has shown resilience in challenging years.

Balance Sheet

Positive

The balance sheet reflects a moderate debt-to-equity ratio and a solid equity ratio, indicating a stable capital structure. The return on equity is strong, but there is potential risk due to substantial total debt levels.

Cash Flow

Positive

Operating cash flow is consistently positive, showing good cash conversion from operations. However, free cash flow has seen significant fluctuations, which may indicate challenges in managing capital expenditures and financing needs.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
356.35M	371.02M	347.92M	343.45M	164.46M
	Gross Profit
207.58M	227.62M	209.76M	209.04M	81.92M
	EBIT
197.79M	217.16M	200.62M	201.16M	75.62M
	EBITDA
298.89M	302.20M	336.96M	270.99M	117.47M
	Net Income Common Stockholders
117.68M	120.04M	188.04M	162.21M	8.11M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
437.15M	410.43M	332.33M	200.65M	128.88M
	Total Assets
2.67B	2.71B	2.68B	2.57B	2.30B
	Total Debt
1.81B	1.81B	1.71B	1.63B	1.40B
	Net Debt
1.37B	1.40B	1.38B	1.43B	1.27B
	Total Liabilities
1.86B	1.86B	1.77B	1.68B	1.47B
	Stockholders Equity
806.63M	847.65M	907.09M	889.39M	835.17M
Cash Flow		Free Cash Flow
182.79M	175.03M	219.88M	-51.09M	-602.09M
	Operating Cash Flow
182.80M	175.03M	219.88M	214.84M	89.30M
	Investing Cash Flow
―	-2.00K	-5.00K	-265.93M	-691.39M
	Financing Cash Flow
-155.61M	-96.54M	-88.76M	123.10M	603.32M

FLEX LNG Technical Analysis

Technical Analysis Sentiment

Positive

Last Price23.72

Price Trends

50DMA

22.70

Positive

100DMA

22.65

Positive

200DMA

22.75

Positive

Market Momentum

MACD

0.26

Negative

RSI

56.09

Neutral

STOCH

27.29

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FLNG, the sentiment is Positive. The current price of 23.72 is above the 20-day moving average (MA) of 23.40, above the 50-day MA of 22.70, and above the 200-day MA of 22.75, indicating a bullish trend. The MACD of 0.26 indicates Negative momentum. The RSI at 56.09 is Neutral, neither overbought nor oversold. The STOCH value of 27.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FLNG.

FLEX LNG Peers Comparison

Overall Rating

UnderperformOutperform

Sector (58)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DLNG	81 Outperform	$133.70M	2.68	10.57%	5.36%	-2.37%	32.03%
TK	80 Outperform	$688.54M	5.77	18.55%	―	-23.02%	-38.08%
LPG	80 Outperform	$962.56M	10.70	8.71%	8.86%	-24.25%	-48.08%
NVGS	78 Outperform	$977.97M	11.11	7.38%	1.42%	6.38%	9.47%
FLNG	72 Outperform	$1.25B	12.36	12.69%	12.70%	-3.95%	-2.25%
GLNG	68 Neutral	$4.36B	1,580.30	0.13%	2.40%	-10.89%	-97.48%
Sector *	58 Neutral	$7.37B	3.39	-4.49%	10.01%	0.82%	-49.15%

* Energy Sector Average

Performance Comparison

FLNG

FLEX LNG

23.72

0.54

2.33%

GLNG

Golar LNG

41.92

14.57

53.27%

Teekay

8.38

0.48

6.08%

NVGS

Navigator Holdings

14.27

-1.73

-10.81%

DLNG

Dynagas LNG Partners

3.65

-0.16

-4.20%

LPG

Dorian LPG

23.11

-14.72

-38.91%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.