CNBC’s Jim Cramer advised investors on Friday to buy shares of Excel Energy as long as it’s a robbery.
“The stock is a little cheaper than Cheniere Energy, which is the king of LNG exports here in the US, at least when you judge them based on last year’s earnings before interest, taxes, depreciation and amortization. … The valuation seems reasonable to me”, the “bad moneysaid the host.
“If you’re looking for a way to get in on the liquefied natural gas boom, which you should be, I think Excelerate Energy is a great way to do it, especially now that stocks have pulled back from their highs,” he added.
Shares of Excelerate Energy rose 2.02% on Friday, but hit a new 52-week low earlier in the day.
Cramer said he likes the company because it’s an LNG game at a time when “The rest of the world is desperate to import liquefied natural gas from the United States.” He also highlighted the company’s strong finances.
“Excelerate has fantastic margins. Their EBITDA margin came in at 29.5% last year, I think the EBITDA margin is the right one to look at because it’s a very capital intensive business so it’s important to reverse the financial impact they take from the beginning”. -paper depreciation of its floating LNG terminals,” he said, also mentioning the company’s profitability.
However, Cramer also highlighted some downsides of the company, including that it is a controlled company with founder George Kaiser with 77% of the voting power.
Excelerate also does not directly play into US liquefied natural gas exports, Cramer added.
“However, as more and more countries enter into agreements to buy US natural gas, they will need infrastructure to offload those shipments. And that’s where Excelerate comes in,” he said.
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