Excelerate Energy has announced a significant move to enhance shareholder value by launching a share buyback program worth $75 million. This decision was approved by the company’s Board of Directors on December 11, 2023, indicating management’s confidence in the stock’s current valuation.
The plan allows Excelerate to repurchase up to 2.4% of its outstanding shares through open market transactions. Such buyback initiatives are often interpreted as a strong signal that a company believes its stock is undervalued.
Market Performance and Financial Overview
Following the announcement, shares of Excelerate Energy (NYSE:EE) saw a slight uptick of 1.0%, opening at $27.31. The company’s performance metrics reveal a fifty-day moving average of $27.12 and a two-hundred-day moving average of $26.57. Excelerate’s market capitalization stands at approximately $3.11 billion, with a price-to-earnings (P/E) ratio of 18.96 and a beta of 1.36.
The company recently reported its quarterly earnings on November 5, 2023, revealing earnings per share of $0.45, surpassing analysts’ expectations of $0.32 by $0.13. Revenue for the quarter reached $391.04 million, significantly exceeding the consensus estimate of $270.82 million and marking a remarkable 102.2% increase compared to the same quarter the previous year. Excelerate Energy achieved a return on equity of 4.34% and a net margin of 3.46%.
Analyst Ratings and Future Outlook
The market response to Excelerate Energy’s performance has prompted various brokerage firms to reassess their ratings. JPMorgan Chase & Co. initiated coverage on September 8, 2023, assigning a “neutral” rating with a price target of $30.00. Following this, DNB Markets set a price objective of $31.00, while Morgan Stanley also targeted $30.00 with an “equal weight” rating.
In a more optimistic outlook, Jefferies Financial Group established a price objective of $37.00 and rated the stock as a “buy.” Additionally, Tudor Pickering upgraded the company from a “hold” to a “strong-buy” rating on November 17, 2023. Overall, one equity research analyst has rated the stock as a “strong buy,” five have given it a “buy” rating, and four maintain a “hold” stance, leading to a consensus rating of “moderate buy” with a target price of $32.38.
Excelerate Energy, a provider of flexible liquefied natural gas (LNG) solutions, specializes in services such as regasification, LNG terminal services, and natural gas supply to power projects. As the company navigates its strategic buyback initiative, investors will be closely monitoring its impact on both share value and market perception in the coming months.
