In this article, we discuss 5 LNG stocks to buy amid Russia-West energy wars. If you want to see more stocks in this selection, click 10 LNG Stocks to Buy Amid Russia-West Energy Wars.
5. Shell plc (NYSE:SHEL)
Number of Hedge Fund Holders: 39
Shell plc (NYSE:SHEL) is a London-based energy and petrochemical company that operates through Integrated Gas, Upstream, Marketing, Chemicals and Products, and Renewables and Energy Solutions segments. The company explores for and extracts crude oil, natural gas, liquefied natural gas, and natural gas liquids. On July 28, Shell plc (NYSE:SHEL) declared a $0.50 per ADS quarterly dividend, which is payable on September 19. As of September 13, the company delivers a dividend yield of 4.52%.
Piper Sandler analyst Ryan Todd on September 12 raised the price target on Shell plc (NYSE:SHEL) to $80 from $75 and reaffirmed an Overweight rating on the shares. The analyst remains constructive on the integrated oils group, noting that near-record distillate margins continue to support upside in refining estimates and this will potentially extend to the winter and into an “equally tight” 2023.
According to Insider Monkey’s data, 39 hedge funds reported owning stakes worth $3.46 billion in Shell plc (NYSE:SHEL) at the end of Q2 2022, compared to 37 funds in the prior quarter worth $5.6 billion. Ken Fisher’s Fisher Asset Management is the largest stakeholder of the company, with 20.25 million shares exceeding $1 billion in value.
Here is what Harding Loevner International Equity Fund has to say about Shell plc (NYSE:SHEL) in its Q1 2022 investor letter:
“While risks of unforeseen consequences arising from the Ukraine conflict are high, on this front we are cautiously optimistic that China will work hard to maintain its neutrality in a credible way, as it is a huge beneficiary of trade with the rest of the world, especially the rich developed nations. We think it likely that China, along with India, will continue to buy oil and gas from Russia (just as Europe, at least for now, plans to keep its gas pipelines open), and do not expect that fact to alter China’s trade relations with the West much. Nevertheless, we must contemplate that our optimism is misplaced on the importance of membership in the global network of exchange. If our central and optimistic case—admittedly an educated guess—is wrong, then we’d need to greatly modify our views of which companies in our opportunity set will face new barriers to profitable growth, and which might stand to benefit, relatively, from a further receding of globalization. (Global trade, after all, has never matched the peak share of GDP it reached in 2008, before the Global Financial Crisis.) We’d expect such a world to be less efficient, as the cold logic of comparative advantage is demoted as a determinant of which goods or services are produced and where. That would lead to a less prosperous world, since exploiting comparative advantage is a cornerstone of wealth creation. If regional blocs began to raise limits on the movement of capital as well as goods, we’d need to parse which of our multinational companies were at risk of declining sales from increasingly hostile, siloed countries. Royal Dutch Shell (NYSE:SHEL) has found its Siberian oil and gas joint venture assets stranded by the combination of sanctions and the public opprobrium of Russia’s actions.”
4. EQT Corporation (NYSE:EQT)
Number of Hedge Fund Holders: 52
EQT Corporation (NYSE:EQT) is a Pennsylvania-based energy company engaged in hydrocarbon exploration and pipeline transport, supplying petroleum, natural gas, natural gas liquids, and liquefied natural gas. The company is positioned to benefit from Europe’s energy crisis with more than 30% upside potential.
On September 6, EQT Corporation (NYSE:EQT) announced the acquisition of THQ Appalachia’s upstream assets and XcL Midstream’s gathering and processing assets for $5.2 billion in cash and stock. The company also doubled its share repurchase program to $2 billion, and raised its year-end 2023 debt reduction goal to $4 billion from $2.5 billion. This makes EQT Corporation (NYSE:EQT) one of the best LNG stocks to buy amid Russia-West energy wars.
Mizuho analyst Vincent Lovaglio on August 18 raised the price target on EQT Corporation (NYSE:EQT) to $59 from $55 and reiterated a Buy rating on the shares. Structural undersupply, driven by multi-year underinvestment, should support higher than anticipated commodity prices and larger than expected cash returns, making the energy group a relatively good investment versus the broader market, the analyst told investors in a bullish thesis.
According to Insider Monkey’s database, 52 hedge funds were long EQT Corporation (NYSE:EQT) at the end of the second quarter of 2022, with collective stakes worth $2.3 billion. Dan Loeb’s Third Point is the leading stakeholder of the company, with 7.5 million shares worth about $259 million.
Here is what ClearBridge Mid Cap Growth Strategy Fund has to say about EQT Corporation (NYSE:EQT) in its Q2 2022 investor letter:
“We initiated a position in EQT (NYSE:EQT), the largest natural gas producer in the U.S., which possesses high-quality acreage within the Marcellus Shale basin. EQT has benefited from tight supply and demand dynamics as cleaner-burning natural gas takes global share from coal and exports to Europe and Asia provide an avenue of demand growth. Longer-term contracts enhance EQT’s earnings visibility as Europe eliminates its dependence on Russian gas.”
3. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 59
Chevron Corporation (NYSE:CVX) is an American multinational provider of crude oil and natural gas. The company also specializes in the liquefaction, transportation, and regasification of liquefied natural gas. On September 12, Piper Sandler analyst Ryan Todd maintained an Overweight rating on Chevron Corporation (NYSE:CVX) and raised the price target on the shares to $190 from $189. The analyst sees upside for the integrated oils group, which will extend to 2023. Despite some upside risk to upstream cost inflation, the analyst noted that there would be no change to priorities across his upstream coverage.
Among the hedge funds tracked by Insider Monkey, 59 funds reported owning stakes in Chevron Corporation (NYSE:CVX) at the end of Q2 2022, compared to 53 funds in the last quarter. Warren Buffett’s Berkshire Hathaway is the biggest position holder in the company, with a stake worth $23.3 billion.
Diamond Hill Capital mentioned Chevron Corporation (NYSE:CVX) in its Q1 2022 investor letter. Here is what the firm has to say:
“Other top contributors in Q1 included multinational energy company Chevron Corp. (NYSE:CVX). The company benefited from increased energy demand as COVID-related economic restrictions eased in tandem with concerns regarding supply interruptions related to Russia’s invasion of Ukraine.”
2. Cheniere Energy, Inc. (NYSE:LNG)
Number of Hedge Fund Holders: 65
Cheniere Energy, Inc. (NYSE:LNG) is an energy infrastructure company that engages in liquefied natural gas businesses in the United States. On September 12, the company raised its guidance for the year. It expects 2022 consolidated adjusted EBITDA of $11 billion-$11.5 billion, versus a prior outlook of $9.8 billion-$10.3 billion. The 2022 distributable cash flow is now projected to be $8.1 billion-$8.6 billion, compared to an earlier guidance of $6.9 billion-$7.4 billion. Cheniere Energy, Inc. (NYSE:LNG) also boosted its stock buyback program by $4 billion and extended it for three more years, as well as approving a revised long-term capital allocation plan.
On August 16, Barclays analyst Marc Solecitto raised the price target on Cheniere Energy, Inc. (NYSE:LNG) to $186 from $160 and reaffirmed an Overweight rating on the shares. Cheniere Energy, Inc. (NYSE:LNG) remains one of the firm’s favored picks due to the secular fundamental tailwinds supporting additional expansion, a conservative valuation, its defensive cash flow characteristics, and short-term catalysts, said the analyst.
According to Insider Monkey’s data, Cheniere Energy, Inc. (NYSE:LNG) was part of 65 hedge fund portfolios at the end of the second quarter of 2022, up from 62 funds in the last quarter. Carl Icahn’s Icahn Capital LP is the biggest stakeholder of the company, with 5.6 million shares worth $746.5 million.
Here is what ClearBridge Global Infrastructure Value Strategy has to say about Cheniere Energy, Inc. (NYSE:LNG) in its Q3 2021 investor letter:
“Cheniere Energy is an energy infrastructure company that owns and operates U.S. liquefied natural gas (LNG) export facilities. Strong quarterly results and the disclosure of capital allocation policies were positively received by the markets. In addition, continued supply and demand tightness in the LNG market created a favorable commodity price environment.”
1. Occidental Petroleum Corporation (NYSE:OXY)
Number of Hedge Fund Holders: 66
Occidental Petroleum Corporation (NYSE:OXY) is a Texas-based company engaged in the development of oil and gas properties. The company produces oil, condensate, natural gas liquids, and natural gas. On July 27, Occidental Petroleum Corporation (NYSE:OXY) declared a quarterly dividend of $0.13 per share, in line with previous. The dividend is payable on October 17, to shareholders of the company as of September 12. It is one of the top LNG stocks to buy amid Russia-West energy wars.
Piper Sandler on September 12 maintained an Overweight rating on Occidental Petroleum Corporation (NYSE:OXY) and lowered the price target on the shares to $92 from $93. Analyst Ryan Todd issued the ratings update.
Among the hedge funds tracked by Insider Monkey, 66 funds were long Occidental Petroleum Corporation (NYSE:OXY) at the end of Q2 2022, compared to 67 funds in the prior quarter. Warren Buffett’s Berkshire Hathaway owns about 20% of the company stock and is the leading position holder in Occidental Petroleum Corporation (NYSE:OXY).
Here’s how Smead Capital Management mentioned Occidental Petroleum Corporation (NYSE:OXY) in its Q2 2022 investor letter:
“For the quarter, our best-performing stocks were Continental Resources (CLR), Merck (MRK) and Occidental Petroleum Corporation (NYSE:OXY). Despite a steep sell-off in June in the oil and gas stocks, two of our oil stocks made the quarterly list.
If you are wondering how we are outperforming the S&P 500 Index in the first half of the year, look no further than our top three performers. Occidental Petroleum (OXY), Continental Resources (CLR) and ConocoPhillips (COP) soared in value and were barely represented in the S&P 500 Index. To quote Jerry Jones, owner of the Dallas Cowboys, “We are in the first quarter on higher energy prices!””
You can also take a look at Best Robotics Stocks To Invest In and 10 Best Media Stocks To Buy.
