NEXT - NextDecade downgraded at Credit Suisse following strong YTD run

NextDecade (NEXT -3.5%) turned lower Friday as Credit Suisse cut shares to Neutral from Outperform but raised its price target to $7.50 from $3 to reflect 100% probability of the sanctioning of Rio Grande LNG, up from 50% previously. "While the macro environment is very conducive to FID for LNG projects more broadly, Rio Grande remains largely un-contracted. Accordingly, we see risk-reward as more balanced at these levels," Credit Suisse's Spiro Dounis writes. The analyst sees Rio Grande's development as highly likely given the new demand for U.S. liquefied natural gas as Europe seeks to diversify away from Russian gas, but NextDecade needs to contract an incremental 7M-8M metric tons/year to underwrite two trains at the site. Dounis also notes Next Carbon Solutions expects to sanction 10 projects over the next 2-3 years, which could drive $400M in distributions. Credit Suisse also upgraded Tellurian to Buy, anticipating a final investment

For further details see:

NextDecade downgraded at Credit Suisse following strong YTD run