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Here's Why Investors Should Buy Golar LNG (GLNG) Stock Now

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·3-min read
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Golar LNG Limited GLNG is currently benefiting from an improved shipping performance.

An Outperformer: Shares of Golar LNG have surged 100.9% in the past year compared with the industry’s 20% increase.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Solid Rank: Golar LNG currently sports a Zacks Rank #1 (Strong Buy). Our research shows that stocks with a Zacks Rank of 1 or 2 offer attractive investment opportunities. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Northward Estimate Revisions: Two estimates for 2022 have moved upward in the past 60 days, indicative of analysts’ confidence in the stock. The Zacks Consensus Estimate for 2022 earnings has moved 23.1% north in the past 60 days.

Positive Earnings Surprise History: Golar LNG has a stellar earnings surprise history. Earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters (one miss), the average beat being 49.8%.

Driving Factors: Improved shipping performance is aiding Golar LNG. FLNG vessel Hilli Episeyo maintains its 100% commercial uptime. The shipping unit has been performing well. Segmental revenues increased 3.4% year over year in the fourth quarter of 2022. In the December quarter, TCE earnings were $57,300 per day (on average) compared with $48,800 in the year-ago period. TCE earnings improved 15.8% sequentially in the fourth quarter. The metric is expected to reflect an improvement in the first quarter of 2022 as well. Results will be available on May 26.

GLNG anticipates a substantial improvement in cash generation in the next two years owing to strength in the LNG shipping market, increased utilization of Hilli, higher oil and gas price environment, and the commencement of the Gimi contract in 2023. Golar LNG expects a significant increase in adjusted EBITDA generation over the next two-three years, driven by its FLNG and shipping units.

Other Stocks to Consider

Investors interested in the Zacks Transportation sector can also consider stocks like Ryder System, Inc. R, C.H. Robinson Worldwide, Inc. CHRW and GATX Corporation GATX.

Ryder has a trailing four-quarter surprise of 48.2%, on average, with its earnings having surpassed the Zacks Consensus Estimate in all the last four quarters. R is benefiting from improving economic and freight conditions in the United States. Revenues at all segments grew (on higher rental revenues, new business and favorable pricing) in first-quarter 2022.

R currently sports a Zacks Rank of 1.

The long-term expected earnings per share (EPS) (three-to-five years) growth rate for C.H. Robinson is pegged at 9%. Improving freight market conditions are aiding CHRW. In first-quarter 2022, the top line improved 41.8% owing to favorable truckload pricing for customers and handsome profits in ocean freight.

Driven by the positives, the stock has rallied 4.3% in the past year.  CHRW currently sports a Zacks Rank of 1.

GATX has a trailing-four quarter surprise of 40.1%, on average, with its earnings having surpassed the Zacks Consensus Estimate in all the last four quarters. The gradual improvement in the North American railcar leasing market is a huge positive for GATX.

Driven by the upsides, the stock has risen 5.4% in the past year.  GATX currently has a Zacks Rank #2 (Buy).


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Ryder System, Inc. (R) : Free Stock Analysis Report
 
C.H. Robinson Worldwide, Inc. (CHRW) : Free Stock Analysis Report
 
Golar LNG Limited (GLNG) : Free Stock Analysis Report
 
GATX Corporation (GATX) : Free Stock Analysis Report
 
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Zacks Investment Research

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