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Golar LNG Limited (GLNG)
:GLNG
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Golar LNG
(NASDAQ:GLNG)
65Neutral
Positive Factors
Acquisition
Golar's acquisition of the remaining ownership in the Hilli for $90.2 million is seen as a solid deal, simplifying the balance sheet and enhancing cash flows.
Growth Prospects
There is clear momentum in deploying more Golar FLNG units, indicating strong growth prospects for the company.
Tax Incentives
The Large Investment Incentive Regime provides significant tax incentives, aiding in financing and project development for Golar.
Negative Factors
Utilization
The Hilli is currently only 55% utilized, resulting in lower cash flows until its deployment in Argentina.
Golar LNG (GLNG) vs. S&P 500 (SPY)
Market Cap
$4.11B
Dividend Yield2.54%
Average Volume (3M)1.89M
Price to Earnings (P/E)80.5
Beta (1Y)1.25
Revenue Growth-12.75%
EPS GrowthN/A
CountryUS
Employees474
SectorEnergy
Sector Strength42
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.38
Shares Outstanding104,622,475
10 Day Avg. Volume1,715,621
30 Day Avg. Volume1,888,372
Financial Highlights & Ratios
PEG Ratio1.10
Price to Book (P/B)1.97
Price to Sales (P/S)0.00
P/FCF Ratio-32.88
Enterprise Value/Market Cap1.18
Enterprise Value/Revenue4.41
Enterprise Value/Gross Profit51.62
Enterprise Value/Ebitda6.92
Forecast
1Y Price Target
$46.67Price Target Upside17.50% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Golar LNG Business Overview & Revenue Model
Company DescriptionGolar LNG Limited designs, builds, owns, and operates marine infrastructure for the liquefaction and regasification of LNG. It operates through Shipping and FLNG segments. The company engages in the operation and chartering of LNG carriers, Floating Liquefaction Natural Gas Vessel (FLNG), and floating storage regasification units (FSRUs), as well as operates external vessels. As of December 31, 2021, it operated nine LNG carriers, one FSRU, and three FLNGs. The company was founded in 1946 and is headquartered in Hamilton, Bermuda.
How the Company Makes MoneyGolar LNG generates revenue primarily through the leasing and operation of its LNG carriers and FSRUs. The company enters into long-term charter agreements with major energy companies, securing stable income from the leasing of its vessels. These contracts often include fixed and variable rate components, depending on the length and terms of the charter. Additionally, Golar LNG participates in LNG trading, capturing margins on the sale and purchase of LNG cargoes. The company also earns income through partnerships and joint ventures that develop and operate LNG infrastructure projects, such as floating liquefaction facilities, further diversifying its revenue streams.
Golar LNG Financial Statement Overview
Summary
Golar LNG's financial performance indicates a company in transition, with signs of recovery in profitability and a stable balance sheet but facing challenges with cash flow management and revenue growth. Improvements in net income and equity stability are promising, but the company must address declining revenues and negative free cash flow to enhance its financial health and investor confidence.Income Statement
Golar LNG shows a mixed performance in its income statement metrics. While there is a notable recovery in net income from a loss in 2023 to a positive figure in 2024, revenue has declined from the previous year by 12.75%. The gross profit margin for 2024 is approximately 48.57%, indicating good cost management, but declining EBIT and EBITDA margins highlight challenges in operational efficiency. The company needs to focus on stabilizing and growing revenue to improve profitability metrics.65
Positive
Balance Sheet
The balance sheet of Golar LNG reflects moderate financial stability. The debt-to-equity ratio has shown some improvement, indicating a decrease in leverage, with the current ratio at about 0.72. Return on Equity (ROE) has improved to approximately 2.47% in 2024, recovering from a negative ROE in 2023. The equity ratio stands at 46.25%, suggesting a balanced capital structure. However, the company should continue to focus on reducing its debt to strengthen its balance sheet further.72
Positive
Cash Flow
Cash flow performance is a concern for Golar LNG, with negative free cash flow in 2024 albeit an improvement from the previous year. Operating cash flow to net income ratio is strong, indicating good cash generation relative to net income, but the free cash flow to net income ratio is negative. The company should prioritize improving operational cash flow and reducing capital expenditures to achieve positive free cash flow.58
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 260.37M | 298.43M | 267.74M | 451.76M | 438.64M | Gross Profit |
| 126.45M | 154.80M | 140.78M | 214.71M | 209.15M | EBIT |
| 62.18M | 15.80M | 91.64M | 181.93M | 173.92M | EBITDA |
| 138.64M | 53.21M | 1.08B | 29.54M | 193.07M | Net Income Common Stockholders |
| 50.84M | -46.79M | 787.77M | -9.68M | 8.60M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 566.38M | 684.38M | 1.13B | 268.63M | 127.69M | Total Assets |
| 4.37B | 4.08B | 4.28B | 4.95B | 4.34B | Total Debt |
| 1.46B | 1.22B | 1.19B | 2.41B | 2.38B | Net Debt |
| 892.58M | 544.85M | 314.07M | 2.14B | 2.25B | Total Liabilities |
| 2.00B | 1.48B | 1.38B | 2.77B | 2.71B | Stockholders Equity |
| 2.01B | 2.07B | 2.50B | 1.73B | 1.29B |
| Cash Flow | Free Cash Flow | |||
| -119.16M | -189.96M | 31.46M | 15.60M | -156.40M | Operating Cash Flow |
| 318.24M | 135.25M | 298.88M | 230.00M | 145.78M | Investing Cash Flow |
| -416.98M | -131.71M | 1.07B | -74.35M | -103.03M | Financing Cash Flow |
| 43.85M | -244.95M | -691.64M | -51.61M | -137.11M |
Golar LNG Technical Analysis
Positive
39.72
Price Trends
37.68
Positive
38.79
Positive
37.32
Positive
Market Momentum
0.39
Positive
53.91
Neutral
64.94
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GLNG, the sentiment is Positive. The current price of 39.72 is below the 20-day moving average (MA) of 39.88, above the 50-day MA of 37.68, and above the 200-day MA of 37.32, indicating a neutral trend. The MACD of 0.39 indicates Positive momentum. The RSI at 53.91 is Neutral, neither overbought nor oversold. The STOCH value of 64.94 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GLNG.
Golar LNG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $1.91B | 5.99 | 17.57% | 13.28% | -18.74% | -39.64% | |
79 Outperform | $1.90B | 10.62 | 17.04% | 8.03% | -5.32% | 5.51% | |
78 Outperform | $2.12B | 3.02 | 24.68% | 3.85% | -7.25% | 31.85% | |
75 Outperform | $4.10B | 8.27 | 21.46% | 9.67% | 13.77% | -24.50% | |
72 Outperform | $1.32B | 11.42 | 14.23% | 12.06% | -3.95% | -2.25% | |
65 Neutral | $4.11B | 80.55 | 2.43% | 2.54% | -12.75% | ― | |
57 Neutral | $7.13B | 3.45 | -3.67% | 5.68% | 0.46% | -50.35% |
* Energy Sector Average
Performance Comparison
GLNG
Golar LNG
39.72
13.78
53.12%
DHT
DHT Holdings
11.71
0.35
3.08%
FRO
Frontline
18.00
-7.64
-29.80%
STNG
Scorpio Tankers
41.61
-37.46
-47.38%
INSW
International Seaways
38.20
-18.77
-32.95%
FLNG
FLEX LNG
24.40
-1.46
-5.65%
Golar LNG Earnings Call Summary
Earnings Call Date:Feb 27, 2025
(Q4-2024)
| % Change Since: 4.14%|
Next Earnings Date:May 27, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Golar LNG's successful transition to a pure FLNG company, with a strong financial position, significant backlog, and progress on key projects like the FLNG Gimi and Mark II. However, challenges remain in securing conversion candidates and addressing infrastructure needs in Argentina for future projects.Q4-2024 Updates
Positive Updates
Transition to Pure FLNG Company
Golar LNG finalized its transition into a pure FLNG company through the sale of Avenir LNG and Golar Arctic, marking the end of a 50-year presence in the LNG shipping market.
Significant EBITDA Backlog
Golar's EBITDA backlog stands at $11 billion before commodity exposure, providing strong earnings visibility, especially with the anticipated long-term charter for the MKII FLNG.
Strong Financial Performance
Adjusted EBITDA for full-year 2024 was $241 million, with a cash position of $700 million. A dividend of $0.25 per share was declared for the quarter.
Hilli's Operational Excellence
Hilli delivered 128 cargoes since start-up in 2018, generating $277 million of EBITDA during 2024, with an increase expected from the recent acquisitions.
Gimi's Commissioning and Upcoming Operations
FLNG Gimi is expected to start full commercial operations in Q2, unlocking approximately $3 billion of EBITDA backlog.
Mark II FLNG Construction Progress
The Mark II FLNG is progressing according to schedule, with an expected delivery in 2027.
Increased Interest in Argentine Project
Three major gas producers joined the Argentine project, strengthening its economic foundation and increasing the potential for further FLNG deployments.
Negative Updates
Challenges in Acquiring Conversion Candidates
While conversion candidates for FLNG units have been identified, the price dynamics in the LNG carrier market are under pressure, presenting challenges in acquisition.
Infrastructure Needs in Argentina
For further FLNG deployments in Argentina, a designated gas pipeline from Vaca Muerta is necessary, which requires coordination and investment from gas producers.
Company Guidance
During the 4Q 2024 earnings call for Golar LNG Limited, CEO Karl Fredrik Staubo and CFO Eduardo Maranhão provided detailed guidance on the company's financial and operational metrics. Golar LNG reported an adjusted EBITDA of $241 million for the full year 2024, with a cash position of approximately $700 million. They declared a dividend of $0.25 for the quarter. The company has an EBITDA backlog of $11 billion, excluding commodity exposure, bolstered by its transition to a pure FLNG company and the sale of non-core assets, including Avenir LNG and Golar Arctic. The FLNG Hilli and Gimi are under long-term contracts, contributing significantly to the backlog, with the Gimi expected to generate approximately $3 billion in EBITDA over its 20-year lease. The company also discussed the strategic acquisition of an 8% stake in the FLNG Hilli, which is expected to yield additional cash flow and increase earnings visibility. Future plans include securing a charter for the MKII FLNG and potentially ordering a fourth FLNG unit, with the company exploring opportunities for further FLNG deployments in Argentina and other markets.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.