HOUSTON - Cheniere Energy, Inc. (NYSE: NYSE:LNG), a major producer and exporter of liquefied natural gas (LNG), announced today that it will increase its share repurchase authorization by an additional $4 billion through 2027. Additionally, the company plans to raise its quarterly dividend by approximately 15% to an annualized rate of $2.00 per common share, starting in the third quarter of 2024.
This move comes as part of Cheniere's '20/20 Vision' capital allocation strategy, which was introduced in 2022. The strategy aims to invest in growth projects, return capital to shareholders, and maintain solid investment grade credit metrics.
Since the announcement of the plan, Cheniere has completed over 60% of the Corpus Christi Stage 3 Project, repurchased about 10% of its shares outstanding, increased its dividend by over 30%, and achieved investment grade ratings across its corporate structure.
Zach Davis, Cheniere's Executive Vice President and Chief Financial Officer, stated, "These increases reflect the continued follow through with our '20/20 Vision' capital allocation plan, which is enabled by Cheniere's outstanding financial performance, as well as our steadfast commitment to safety and operational excellence throughout our business." He added that the plan aims to deploy over $20 billion in cash towards growth, capital returns, and a robust balance sheet to generate substantial distributable cash flow for shareholders.
The dividend increase is subject to approval by Cheniere's Board of Directors. The share repurchase authorization allows for buybacks through various methods, subject to market conditions and other factors, and does not obligate Cheniere to acquire any specific number of shares.
Cheniere's executive management will present further details at the J.P. Morgan Energy, Power and Renewables Conference in New York City on June 18, 2024. The company continues to lead in the LNG sector, with a significant liquefaction capacity in operation and more under construction.
The information in this article is based on a press release statement from Cheniere Energy, Inc.
In other recent news, Cheniere Energy reported strong financial performance in Q1 of 2024, with a consolidated adjusted EBITDA of about $1.8 billion and a distributable cash flow of around $1.2 billion. Despite production challenges, the company achieved a net income of approximately $500 million.
Cheniere Energy's full-year guidance was reconfirmed, with an expected consolidated adjusted EBITDA of $5.5 billion to $6 billion and a distributable cash flow of $2.9 billion to $3.4 billion.
In other developments, TD Cowen raised the price target for Cheniere Energy to $185 from $178, maintaining a Buy rating. The firm anticipates a shift in the company's equity dynamics in the third quarter, with potential resolutions of the non-Free Trade Agreement permit pause and the sanctioning of Corpus trains 8 and 9 serving as significant developments.
Furthermore, Cheniere Energy repurchased over 7.5 million shares for approximately $1.2 billion and plans a new buyback plan before year-end. The company also issued an inaugural investment-grade bond, retiring existing senior notes and reducing debt balances. Finally, Cheniere Energy plans to spend $1.5 billion to $2 billion on the Corpus Christi Stage 3 project this year, reflecting its proactive strategies in navigating the complexities of the energy transition."
InvestingPro Insights
In light of Cheniere Energy's announcement regarding its share repurchase plan and dividend increase, key metrics and insights from InvestingPro provide additional context for investors. The company's commitment to returning value to shareholders is underscored by the fact that management has been actively buying back shares as part of its capital allocation strategy. This aligns with the "20/20 Vision" plan that emphasizes growth investments and shareholder returns.
An InvestingPro Tip notes that Cheniere has consistently raised its dividend for the past three years, reflecting a solid financial position and a commitment to providing shareholder value. The upcoming dividend increase to an annualized rate of $2.00 per common share starting in the third quarter of 2024 reinforces this trend.
InvestingPro Data reveals that Cheniere Energy has a market capitalization of $35.5 billion and a P/E ratio of 7.49, with an adjusted P/E ratio for the last twelve months as of Q1 2024 sitting at 7.17. These figures suggest that the company is valued favorably in terms of earnings. Additionally, the Price/Book ratio for the same period is 8.35, which is relatively high, indicating that the market values the company's assets at a premium.
Investors seeking to delve deeper into the financials and future projections for Cheniere Energy can find more InvestingPro Tips at https://www.investing.com/pro/LNG. There are 9 additional tips available, offering insights into earnings revisions, stock volatility, net income expectations, and more. For those interested in accessing these tips, use the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.