Stock Analysis

Introducing Cheniere Energy (NYSEMKT:LNG), The Stock That Zoomed 123% In The Last Five Years

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NYSEAM:LNG
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When you buy shares in a company, it's worth keeping in mind the possibility that it could fail, and you could lose your money. But on the bright side, if you buy shares in a high quality company at the right price, you can gain well over 100%. For instance, the price of Cheniere Energy, Inc. (NYSEMKT:LNG) stock is up an impressive 123% over the last five years. Also pleasing for shareholders was the 35% gain in the last three months.

See our latest analysis for Cheniere Energy

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

During the five years of share price growth, Cheniere Energy moved from a loss to profitability. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

earnings-per-share-growth
AMEX:LNG Earnings Per Share Growth January 13th 2021

We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. This free interactive report on Cheniere Energy's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

A Different Perspective

Cheniere Energy provided a TSR of 4.7% over the last twelve months. But that return falls short of the market. It's probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 17% over five years. Maybe the share price is just taking a breather while the business executes on its growth strategy. It's always interesting to track share price performance over the longer term. But to understand Cheniere Energy better, we need to consider many other factors. Even so, be aware that Cheniere Energy is showing 4 warning signs in our investment analysis , and 1 of those is a bit unpleasant...

Cheniere Energy is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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

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What are the risks and opportunities for Cheniere Energy?

Cheniere Energy, Inc., an energy infrastructure company, primarily engages in the liquefied natural gas (LNG) related businesses in the United States.

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Rewards

  • Trading at 19% below our estimate of its fair value

  • Earnings are forecast to grow 28.49% per year

Risks

  • Negative shareholders equity

  • Significant insider selling over the past 3 months

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Share Price

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1Y Return

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