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Golar LNG’s Earnings Are Expected to Rise 93%

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Target price

On January 12, 2018, Cowen and Company raised the target price for Golar LNG (GLNG) to $44 from $41. The consensus 12-month target price on Golar LNG is $34.13, which implies a potential return of 16.6%—compared to the market price of $29.2 as of January 19, 2018.

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Analysts’ ratings

According to Reuters, the consensus rating for Golar LNG is 1.5 (strong buy) on a scale of one (strong buy) to five (strong sell). Another LNG (UNG) carrier, Höegh LNG Partners (HMLP) has a consensus rating of 1.44 (strong buy). Dynagas LNG Partners (DLNG) and GasLog (GLOG) have a consensus rating of 2.5 and 1.93, respectively.

Analysts’ recommendations

For Golar LNG, 14 analysts gave recommendations and 93% of the analysts are bullish on the stock. Eight analysts gave a “strong buy” five analysts gave a “buy” recommendation, one analyst gave a “hold” recommendation. None of the analysts recommended a “strong sell” or “sell” rating for Golar LNG.

Revenue and earnings estimates

Analysts expect Golar LNG’s 4Q17 revenue to be $44.6 million, which is a 37.6% rise quarter-over-quarter and a 93% rise from $23.06 million in 4Q16. In 1Q18, analysts expect another rise in the revenue to $80.38 million.

The revenue for 2017 is estimated at $125.09 million—a 56% rise from $80.2 million in 2016. In 2018, the revenue is expected to be $367 million.

Since Golar LNG’s revenue is expected to rise, its EBITDA (earnings before interest, tax, depreciation, and amortization) is also expected to increase. Analysts estimated that Golar LNG’s 4Q17 EBITDA will be $12.92 million—compared to -$5.5 million in 3Q17. The 2017 and 2018 EBITDA estimates for Golar LNG are -$18.1 million and $207 million, respectively—compared to -$68 million in 2016.

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