GLNG - Golar LNG finally at catalyst stage and could double by year-end Stifel says

2023-07-05 12:25:26 ET

Golar LNG ( NASDAQ: GLNG ) +8.5% in Wednesday's trading after Stifel analysts Benjamin Nolan and Frank Galanti said the stock could double by the end of this year if certain catalysts materialize.

"Perhaps no other names in our coverage has as much catalyst-linked upside as Golar with multiple potential events, which we believe could collectively double the share price by year-end should those events materialize," the analysts wrote.

"While we have heard 'a project will be announced later this year' before, management seemed very confident that there would be an announcement before the end of the year and intimated that it could be as soon as the next earnings call" in mid-August, "very likely" a new contract on the Hilli or perhaps a contract on the Mark II retrofit, the analysts said.

Since the Hilli contract needs to be signed soon to prepare for the next employment, "and sounds as though that is on the cusp of being announced," Nolan and Galanti said, adding a new contract likely would last at least 10 years and possibly as long as 15-20 years.

"At a $3/MMBtu average toll, the unit would generate ~$300M of annual EBITDA, although based on historic TTF LNG prices, the average toll would likely be more than $5/MMBtu, meaning the unit would generate over $500M of EBITDA," the analysts wrote.

More on Golar LNG:

• Financial and valuation comparison to sector peers
• Analysis: Golar And The FLNG Market: Risky But Cheap, And Without Much Competition
• Stock price return: Down 9% YTD, down 10% in the past 12 months

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