Stock Analysis

Golar LNG (NASDAQ:GLNG) shareholder returns have been splendid, earning 147% in 1 year

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Unfortunately, investing is risky - companies can and do go bankrupt. But when you pick a company that is really flourishing, you can make more than 100%. Take, for example Golar LNG Limited (NASDAQ:GLNG). Its share price is already up an impressive 147% in the last twelve months. It's also good to see the share price up 87% over the last quarter. The longer term returns have not been as good, with the stock price only 24% higher than it was three years ago.

Since it's been a strong week for Golar LNG shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for Golar LNG

Given that Golar LNG didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last year Golar LNG saw its revenue grow by 3.0%. That's not a very high growth rate considering it doesn't make profits. So we wouldn't have expected the share price to rise by 147%. The business will need a lot more growth to justify that increase. We're not so sure that revenue growth is driving the market optimism about the stock.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

NasdaqGS:GLNG Earnings and Revenue Growth April 14th 2022

Take a more thorough look at Golar LNG's financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that Golar LNG shareholders have received a total shareholder return of 147% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 0.5% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 1 warning sign for Golar LNG that you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

What are the risks and opportunities for Golar LNG?

Golar LNG Limited designs, owns, and operates marine infrastructure for the liquefaction of natural gas.

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  • Trading at 66.4% below our estimate of its fair value

  • Earnings are forecast to grow 71.95% per year


  • Profit margins (19.6%) are lower than last year

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