Tension appears to be increasing between the U.S. and Iran amid the shaky two-week ceasefire from the war. Now the U.S. administration has imposed a naval blockade on Iran, which has essentially cut off the country’s international sea trade that powers about 90% of its economy.
The latest round of escalation involving the two countries and the vital Strait of Hormuz, which is essential for energy transport, has raised the possibility of disruptions to global energy supply. Effectively, the naval blockade of Iranian ports can exacerbate the supply crunch. Although Middle Eastern gas exports typically go to Asia, a prolonged blockade can create a supply shortage in Europe as well.
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In fact, European gas futures leaped more than 9% on the news on Apr. 14. Paying at the pump has been a pain for customers amid the geopolitical conflict. Ship-tracking data shows that only a handful of ships are crossing the Strait each day, compared to more than 100 per day before the war.
Given this backdrop, should you consider investing in U.S.-based natural gas producer Cheniere Energy (LNG) now?
About Cheniere Stock
Leading U.S.-based energy company Cheniere Energy specializes in liquefied natural gas (LNG) production and export. It operates major facilities, such as Sabine Pass and Corpus Christi. Also, the company owns and operates the Creole Trail pipeline, which interconnects the Sabine Pass LNG Terminal with several large interstate and intrastate pipelines, and the Corpus Christi pipeline, which interconnects the Corpus Christi LNG Terminal with interstate and intrastate natural gas pipelines. Headquartered in Houston, Texas, Cheniere has a market capitalization of $54.57 billion.
In addition to supply disruptions stemming from the war in the Middle East, strong financial results, driven by high LNG deliveries and long-term deals, have led the stock to surge.
Over the past 52 weeks, Cheniere’s stock has gained 13.13%, while it has been up 32.08% year-to-date (YTD). The company’s shares reached a 52-week high of $300.89 on March 30, but are down 14.67% from that level.
www.barchart.com On a forward-adjusted basis, Cheniere’s stock is trading at a price-to-earnings (non-GAAP) ratio of 16.46 times, which is higher than the industry average of 12.91 times.
Cheniere Reported Record 2025 Results with Notable Milestones
Last year, Cheniere exported a record 670 cargoes, up 4% year-over-year (YOY), with the first 4 Trains of the CCL Stage 3 Project reaching substantial completion. The company’s annual revenue increased 27% YOY to $19.98 billion. Its consolidated adjusted EBITDA increased 13% annually to $6.94 billion.
Cheniere completed its “20/20 Vision” capital allocation plan ahead of schedule, deploying over $20 billion since its launch in 2022. The company also increased its share repurchase authorization to over $10 billion through 2030, indicating that Cheniere is confident in its cash generation.
Wall Street analysts have a solid outlook on Cheniere’s future earnings. For the current fiscal year, EPS is projected to increase 27.5% annually to $14.24, followed by a 9.8% surge to $15.64 in the next fiscal year. Analysts expect the company’s EPS to increase by 136.9% YOY to $3.72 for the first quarter of 2026 (to be reported on May 7, before the market opens).
What Do Analysts Think About Cheniere’s Stock?
This month, analysts at Citigroup raised Cheniere’s stock price target from $280 to $330 while maintaining a bullish “Buy” rating. Analysts from the firm believe that the supply disruptions tied to the war between the U.S. and Iran could create ripple effects that position U.S. LNG as a potential long-term winner.
In addition, Jefferies analysts raised Cheniere’s stock price target from $275 to $330, while maintaining a “Buy” rating. The analyst highlighted that the focus remains on how the company can capitalize on the war, while expecting a production beat of roughly 1 million tons in 2026, which should lead to slightly higher spot exposure.
Cheniere has come into the spotlight, with analysts awarding it a consensus “Strong Buy” rating overall. Of the 22 analysts rating the stock, a majority of 18 analysts have given it a “Strong Buy” rating, two analysts suggest “Moderate Buy,” while two analysts are playing it safe with a “Hold” rating. The consensus price target of $302.90 represents 18% upside from current levels. The Street-high price target of $340 indicates a 32.43% upside.
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www.barchart.com Bottom Line
The blockade might be a windfall for U.S.-based natural gas firms like Cheniere and a prime opportunity to realize higher prices, as shipments might remain stuck in the Strait of Hormuz. Also, Cheniere bolsters itself through expansions, such as the planned Stage 4 expansion at its Corpus Christi LNG facility. Therefore, it might be beneficial to look into Cheniere now.
On the date of publication, Anushka Dutta did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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