EE: Iraq LNG Import Deal Will Drive Future Demand And Share Upside

Narrative Update on Excelerate Energy

Analysts have nudged their price target on Excelerate Energy modestly higher to approximately 34.50 dollars from about 34.33 dollars, citing slightly lower discount rate assumptions and marginally improved expectations for revenue growth, profit margins, and future valuation multiples.

What's in the News

• Excelerate Energy signed a definitive commercial agreement with a subsidiary of Iraq's Ministry of Electricity to develop the country's first LNG import terminal at the Port of Khor Al Zubair, marking Iraq's initial access to global LNG markets (Key Developments).
• The integrated project includes a five year regasification and LNG supply agreement, with extension options and a minimum contracted offtake of 250 MMscf/d, aimed at supporting Iraq's growing electricity demand (Key Developments).
• Excelerate's new FSRU, Hull 3407, under construction at HD Hyundai Heavy Industries and due for delivery in 2026, will provide up to 1 billion standard cubic feet per day of regasification capacity, in line with Iraq's large scale energy needs (Key Developments).
• The project is expected to help Iraq diversify away from imported pipeline gas and strengthen energy security, and is backed by both Iraqi and U.S. government stakeholders, underlining its strategic significance (Key Developments).

Valuation Changes

• The fair value estimate has risen slightly to approximately 34.50 dollars, up from about 34.33 dollars previously.
• The discount rate has decreased marginally to roughly 7.04 percent, down from about 7.05 percent.
• Revenue growth has improved slightly to around 18.45 percent, up from about 18.37 percent.
• The net profit margin has edged higher to roughly 3.48 percent, up from about 3.47 percent.
• The future P/E multiple has increased very slightly to about 24.11 times, up from approximately 24.10 times.