JPMorgan Buys Cheniere Rally, Sees 33% Upside Left

On Friday, J.P.Morgan issued a company note on Cheniere Energy, Inc. LNG after recent analysis revealed visible project catalysts that may drive shareholder value. Analysts at J.P. Morgan initiated coverage of Cheniere Energy with an Overweight rating and a $54 price target.

Jeremy Tonet, an analyst at J.P. Morgan, wrote, “We initiate coverage of the Cheniere complex at Overweight, expecting outperformance as visible project catalysts continuously de-risk the story and drive solid stock performance higher from recent 3-year lows...With...Cheniere’s solid contracts granting significant visibility, we expect more de-risking catalysts to drive upside in 2016.”

Analysts at J.P. Morgan gave 2 key reasons why they see strength in Cheniere Energy:

1. Market leading position:

J.P. Morgan noted that Cheniere was the first North American mover, beginning their services 2 years before their next U.S. peer. This allows Cheniere to have the scale and diversification in the Americas to potentially drive increasing market share, revenue growth, and profit margins.

2. Contracts

Another positive that analysts highlighted is Cheniere Energy’s value driven contracts which remain favorable as there are no opportunities to change the fixed fees or re-sell contracts for customers. This may allow Cheniere to remain a market leader and drive value for shareholders in 2016.

According to TipRanks, Jeremy Tonet has initiated 5 energy companies, downgraded 5 firms and upgraded one in the past 12 months.

Currently, Cheniere Energy is trading at $37.68, up 1.70 percent.