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Golar LNG Limited’s GLNG proactive efforts to expand its services are commendable. The company’s recent acquisition of all minority interests in the FLNG (floating LNG) Hilli is boosting its position in the FLNG sector. Due to these tailwinds, GLNG shares have performed impressively on the bourse. If you have not taken advantage of the share price appreciation yet, it’s time to do so.
Factors Favoring GLNG Stock
Robust Price Performance: The company’s price trend reveals that its shares have surged 92% over the past six months, surpassing the industry’s 16.7% fall.
Image Source: Zacks Investment Research
Northward Estimate Revisions: The Zacks Consensus Estimate for earnings per share has been revised upward by 17.1% over the past 60 days for the fourth quarter of 2024. For 2025, the consensus mark for earnings per share has moved 2.5% north in the same time frame. The favorable estimate revisions indicate brokers’ confidence in the stock.
Solid Zacks Rank: GLNG currently sports a Zacks Rank #1 (Strong Buy).
Positive Earnings Surprise History: Golar LNG has an encouraging earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missed once, delivering an average surprise of 30.2%.
Growth Factors: The acquisition of all minority interests in the FLNG Hilli by Golar LNG represents a major step in strengthening its position within the FLNG sector. On Dec. 24, 2024, GLNG acquired the remaining minority stakes in the FLNG Hilli from Seatrium and Black & Veatch for $90.2 million. Currently, the FLNG Hilli is contracted with Perenco in Cameroon until 2026, after which it will relocate to Argentina under a 20-year contract. Golar's increased ownership, effective from Jan. 1, 2025, will contribute an additional $0.5 billion to its adjusted EBITDA backlog. Golar made a $7 million payment to Seatrium to settle other outstanding issues.
The company’s strong commitment to rewarding its shareholders through dividends and share buybacks is commendable. In 2023, Golar LNG distributed more than $168 million in dividends and buybacks. In the third quarter of 2024, the company paid out a dividend of $0.25 per share. $74.1 million of the approved share buyback scheme of $150.0 million remains available.
GLNG exited the third quarter of 2024 with a robust liquidity position, holding approximately $732 million in cash and cash equivalents and a net debt of $646 million. The current ratio (a measure of liquidity) stood at 1.55 at the September-end quarter, which is favorable, as a current ratio above 1 indicates that the company has sufficient cash to meet its debt obligations.