24/7 Wall St. » LNG

24/7 Wall St. Closing Bell (CHK, LVLT, QCOM, CRM, DSX, COCO, APA, WNR, YRCW, SHOO, SRE, SLE, RGLD, OWW, GM, MGM, AES, LNG, DUK, EL, PGR, WPO, GMCR, KNSY, HLF)

Paul Ausick — Thu, 03 May 2012 20:08:03 +0000

The major US stock indexes opened mostly flat this morning following a softer-than-expected report from the Institute for Supply Management on non-manufacturing growth (our coverage here). The report on new unemployment benefits claims came in better than expected, but not enough to overcome the ISM numbers (more coverage here). Retail sales reports were also weak, with growth of just 0.8% compared with an estimate of 1.5% (more coverage here). The energy sector has been particularly hard hit today on reports that supply is keeping up with demand, some weak earnings reports, and a comment from OPEC that it would like to see Brent crude at $100/barrel, not $120 or more (our coverage here).

The US dollar index rose today, now up 0.11% at 79.221. The GSCI commodity index is down about -1.3% at 678.65, with commodities mixed on the small gains in the dollar. WTI crude oil closed down -2.6% at $102.54/barrel, and Brent crude trades down -1.84% at $116.02/barrel. Gold settled down -1.2% today, at $1,634.80/ounce.

The unofficial closing bells put the DJIA down nearly 62 points to 13,206.59 (-0.47%), the NASDAQ fell more than 35 points (-01.16%) to 3,024.30, and the S&P 500 fell -0.77% or nearly 11 points to 1,391.57.

There were several analyst upgrades and downgrades today, including Chesapeake Energy Corp. (NYSE: CHK) maintained as ‘buy’ but target price cut to $31 at BofA/ML and raised to ‘outperform’ at Bernstein; Level 3 Communications Inc. (NYSE: LVLT) reiterated ‘buy’ at SunTrust Robinson Humphrey and cut to ‘neutral’ at Piper Jaffary; Qualcomm Inc. (NASDAQ: QCOM) reiterated as ‘buy’ at BofA/ML; and Salesforce.com (NYSE: CRM) raised to ‘outperform’ with a $185 target price at Credit Suisse.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Diana Shipping Inc. (NYSE: DSX) is down -4.4% at $7.63; Corinthian Colleges Inc. (NASDAQ: COCO) is down -21.6% at $3.05; Apache Corp. (NYSE: APA) is down -3.7% at $91.99; Western Refining Inc. (NYSE: WNR) is down -2.6% at $18.42; YRC Worldwide Inc. (NASDAQ: YRCW) is down -8% at $6.79; Steve Madden Ltd. (NASDAQ: SHOO) is down -1.7% at $43.54; Sempra Energy (NYSE: SRE) is up 0.6% at $64.29 after posting a new 52-week high of $65.37 earlier today; Sara Lee Corp. (NYSE: SLE) is down -1% at $22.10; Royal Gold Inc. (NASDAQ: RGLD) is down -2.6% at $59.43 (more coverage here); Orbitz Worldwide Inc. (NYSE: OWW) is up 4.9% at $4.09; General Motors Co. (NYSE: GM) is down -2.3% at $22.42 (more coverage here); and MGM Resorts International (NYSE: MGM) is down -4.4% at $12.95.

Tomorrow we get earnings from AES Corp. (NYSE: AES), Cheniere Energy Inc. (AMEX: LNG), Duke Energy Corp. (NYSE: DUK), Estee Lauder Companies Inc. (NYSE: EL), Progressive Corp. (NYSE: PGR), and The Washington Post Co. (NYSE: WPO).

Other standouts from today include the following stocks:

Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) is down -47.3% at $26.11. The company reported earnings last night, and lowered guidance. More coverage here and here.

Kensey Nash Corp. (NASDAQ: KNSY) is up 32.2% at $38.35. The company is being acquired by a Dutch firm for $360 million. More coverage here.

Herbalife Ltd. (NYSE: HLF) is down -12.7% at $46.02. The nutrition products company flubbed some questions at last night’s conference call. More coverage here.

Stay tuned for Friday. San Francisco Fed President John Williams is giving a speech. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – Non-farm payrolls
3:00 p.m. – Treasury STRIPS

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AES, APA, CHK, COCO, CRM, DSX, DUK, EL, GM, GMCR, HLF, KNSY, LNG, LVLT, MGM, OWW, PGR, QCOM, RGLD, SHOO, SLE, SRE, WNR, WPO, YRCW

Cheniere Gets OK to Export Natural Gas (CQP, LNG)

Paul Ausick — Tue, 17 Apr 2012 11:05:03 +0000

Cheniere Energy Partners LP. (AMEX: CQP) announced last night that the company has received approval from the Federal Energy Regulatory Commission (FERC) “to site, construct and operate facilities for the liquefaction and export of domestically produced natural gas at the Sabine Pass LNG terminal.” The FERC’s order permits the company to build up to four liquefied natural gas plants, called ‘trains,’ at the Sabine Pass terminal.

The export terminal gives natural gas producers hope not only for selling liquefied natural gas to foreign countries, but that the demand will raise prices in the US. At the current price of around $1/thousand cubic feet, domestic natural gas is essentially free. When exported as LNG, the gas currently fetches $15-$16/thousand cubic feet.

Cheniere has long-term contracts for deliveries to begin in late 2015 or early 2016 for the first two trains and 2017/2018 for the second two trains.

Cheniere Energy Partners and its general partner, Cheniere Energy Inc. (AMEX: LNG), are trading near 52-week highs on the FERC announcement.

Filed under: International Markets, Oil & Gas, Regulation Tagged: CQP, LNG

Alaska Natural Gas Pipeline Back on Front Burner (BP, XOM, COP)

Paul Ausick — Thu, 22 Mar 2012 11:31:10 +0000

Back in the day — about 4 years ago — when US natural gas production was falling and prices were rising to as much as $13/thousand cubic feet, two competing natural gas pipeline routes from Alaska’s North Slope were being proposed to transport natural gas to the Lower 48. Then came the shale gas boom, natural gas prices fell to below $3/thousand cubic feet, and the Alaska pipeline projects fell off the table.

Now, the state is in discussions with Exxon Mobil Corp. (NYSE: XOM), BP plc (NYSE: BP), and ConocoPhillips (NYSE: COP) for a $40-$50 billion natural gas pipeline and liquefaction plant project that would pipe the gas from Alaska’s North Slope to the state’s southern coast where it would be liquefied and put on ships for Asian markets. The first issue to clear up is the existing lease to gas fields on the North Slope, which dates back to 1977, and upon which the companies have never acted. The governor and the companies hope to reach an agreement on extending the leases as early as next week.

Alaska has proved reserves of 35 trillion cubic feet of natural gas and potential (undiscovered) reserves totalling another 236 trillion cubic feet. Right now, that gas is stranded and essentially worthless, both to the state and to the producers. A new pipeline and liquefaction plant would change that, provided that the companies can line up customers.

That will be harder to do, given the massive development in Australia and elsewhere of natural gas resources and liquefaction plants. Liquefied natural gas (LNG) currently brings about $15-$16/thousand cubic feet in Asian markets, but spending $40 billion or so demands that customers are locked into long-term contracts.

The big idea, of course, is China, which has a goal of replacing a portion of its coal-fired electricity generation with gas-fired generation, reducing the amount of carbon emissions by nearly 50%. The thing is, though, China is just getting started on developing its own shale gas resources, which are estimated to hold 1,275 trillion cubic feet of natural gas. With that much of its own gas, China may not be a market for Alaskan LNG long enough to repay the $40 billion investment.

Japan and Korea also import massive amounts of LNG and could offer alternative markets. But they have already committed to LNG supplies from Australia and Qatar and unless demand grows, they’re not big enough to support the Alaskan LNG project.

To make a guess at what might happen: Alaska and the oil companies will reach an agreement on extending the lease, but by the time all the studies and plans are completed (which could be never), the gas on the North Slope will still be in the ground, just as stranded as it ever was.

Paul Ausick

Filed under: China, Oil & Gas Tagged: Alaska natural gas pipeline, Alaska North Slope natural gas, liquefied natural gas, LNG

Cheniere Increases and Prices Secondary Offering (LNG, CQP, BX)

Paul Ausick — Wed, 14 Mar 2012 15:39:04 +0000

Cheniere Energy Inc. (AMEX: LNG) increased the size of its secondary stock offering from 17 million to 21 million shares and priced the offering at $15.10/share this morning. Credit Suisse, the sole underwriter, was granted a 30-day overallotment option of 3.15 million additional shares.

Cheniere and its subsidiary, Cheniere Energy Partners LP (AMEX: CQP), have received approvals to convert the Sabine Pass liquefied natural gas receiving terminal into an export terminal. Cheniere Energy Partners will build the $10 billion liquefaction facilities, and construction could start in less than a month.

But today’s secondary stock offering is being used “for general corporate purposes, including repayment of indebtedness.” Two weeks ago Cheniere Energy Partners announced a $2 billion investment from Blackstone Group LP (NYSE: BX) to get construction going on the first production facilities.

Investors are not happy about the pricing of the secondary offering and shares of Cheniere Energy Inc. are down about -5.7% at $15.10, after closing at $16.01 last night. The stock’s 52-week range is $3.17-$17.07.

Filed under: Oil & Gas, Secondary Offering Tagged: BX, CQP, LNG

Mid-day Movers (ATPG, PEIX, LNG, DNDN, BCPC)

Paul Ausick — Mon, 27 Feb 2012 16:40:12 +0000

In the last half hour of the morning today, all three major US stock indexes pushed their way into positive territory, with the DJIA up nearly 4 points at about 13,987, the Nasdaq up more than 5 points at 2,969, and the S&P 500 up less than 1 point to 1,367. After opening sharply lower this morning, markets rebounded from an early dip following a better-than-expected report on pending home sales. The dollar is stronger today, with the dollar index up 0.19% at 78.548. The stronger dollar is pushing some commodities down, with grains losing the most.

Among the major movers at around noon today are ATP Oil & Gas Corp. (NASDAQ: ATPG), Pacific Ethanol Inc. (NASDAQ: PEIX), Cheniere Energy Inc. (AMEX: LNG), Dendreon Corp. (NASDAQ: DNDN), and Balchem Corp. (NASDAQ: BCPC).

ATP is up more than 21% at $8.63. Volume is already nearly 4x the daily average of about 1.7 million shares traded. The independent oil & gas company reported a fourth successful well at its Telemark Hub project.

Pacific Ethanol is up nearly 19% at $1.65. Volume is more than 3x the daily average of about 6 million shares traded. The ethanol maker is expected to report solid earnings and revenues after markets close today.

Cheniere is up about 12% at $15.72 after posting a new 52-week high of $16.25 earlier. Volume is already double the daily average of 5.6 million shares traded. The liquefied natural gas company announced an investment from Blackstone Group LP (NYSE: BX). More coverage here.

Dendreon is down nearly -18% at $12.20. Volume is already nearly triple the daily average of around 9 million shares traded. The drug maker reported lower-than-expected revenues this morning. More coverage here.

Balchem is down more than -11% at $31.67 after posting a new 52-week low of $31.24 earlier this morning. Volume is about 3x the daily average of around 130,000 shares traded. The chemical company reported weaker-than-expected earnings this morning.

Paul Ausick

Filed under: 24/7 Wall St. Wire Tagged: ATPG, BCPC, DNDN, LNG, PEIX

Morning Movers (ATPG, LNG, CTB, CASM, DNDN)

Paul Ausick — Mon, 27 Feb 2012 15:30:27 +0000

The three major US equities indexes opened lower this morning following news from Europe that the G20 has refused to increase the IMF’s funding to deal with the Eurozone debt crisis. Crude oil prices are also falling as the outlook for a stronger global economic recovery fade a little. In the first 45 minutes of trading, the DJIA is down about 59 points at around 12,924, the Nasdaq Composite is down nearly 20 points at around 2,944, and the S&P 500 is down more than 7 points at around 1,359.

There are several stocks trading more heavily than usual this morning, and also experiencing large gains or drops in share prices. These include the ATP Oil & Gas Corp. (NASDAQ: ATPG), Cheniere Energy Inc. (AMEX: LNG), Cooper Tire & Rubber Co. (NYSE: CTB), CAS Medical Systems Inc. (NASDAQ: CASM), and Dendreon Corp. (NASDAQ: DNDN).

ATP is up more than 15% at $8.19. Volume is already nearly 2.5x the daily average of about 1.7 million shares traded. The independent oil & gas company reported a fourth successful well at its Telemark Hub project.

Cheniere is up about 11% at $15.55 after posting a new 52-week high of $16.25 earlier. Volume is already higher the daily average of 5.6 million shares traded. The liquefied natural gas company announced an investment from Blackstone Group LP (NYSE: BX). More coverage here.

Cooper Tire is up more than 10% at $17.24. Volume is already nearly double the daily average of around 590,000 shares traded. The tire maker reported better-than-expected earnings and revenues this morning..

CAS Medical Systems is up nearly 5% at $2.40. Volume is already nearly 4x the daily average of around 14,000 shares traded. The medical device maker reported FDA approval for a neo-natal oxygen saturation device.

Dendreon is down more than -14% at $12.72. Volume is already nearly double the daily average of around 9 million shares traded. The drug maker reported lower-than-expected revenues this morning. More coverage here.

Paul Ausick

Filed under: 24/7 Wall St. Wire Tagged: ATPG, CASM, CTB, DNDN, LNG

24/7 Wall St. Closing Bell (CHK, GOOG, KR, LNG, CCL, CREE, SCHW, FAST, GS, STT, CLWT, UEPS, COOL, KUTV, AAPL, MCD, NKE)

Paul Ausick — Wed, 18 Jan 2012 21:08:22 +0000

Markets opened slightly lower in the US this morning, but picked up steam in the morning and continued to rise, if slowly, for the rest of the day. The tech sector showed the most strength, with semiconductor stocks rising sharply and pushing the NASDAQ Composite index up more than 1.4% about half an hour before the closing bell. Financial stocks also did well today, and the euro rose back above $1.28 following a report that the IMF wants to increase its lending capacity to around $885 billion. Crude is mixed today, with WTI up fractionally at $100.78/barrel and Brent down -0.65% at $110.81/barrel. Gold rose as well today to $1,658.90.

The unofficial closing bells put the DJIA up nearly 97 points to 12,578.95 (0.78%), the NASDAQ rose nearly 42 points (1.53%) to 2,769.71, and the S&P 500 rose 1.11% or more than 14 points to 1,308.04.

There were several analyst upgrades and downgrades today, including Chesapeake Energy Corp. (NYSE: CHK) cut to ‘hold’ at Brean Murray; Google Inc. (NASDAQ: GOOG) cut to ‘market perform’ at Wells Fargo; The Kroger Co. (NYSE: KR) cut to ‘market perform’ at BMO Capital; Cheniere Energy Inc. (AMEX: LNG) started as ‘outperform’ with a $13.50 target price at Credit Suisse; and Carnival Corp. (NYSE: CCL) maintained as ‘hold’ but estimates cut at Argus.

Earnings reports since markets closed yesterday have led to some price changes as of the last half hour of trading today: Cree Inc. (NASDAQ: CREE) is up 4.3% at $24.33; The Charles Schwab Corp. (NYSE: SCHW) is down -1.3% at $12.00; Fastenal Co. (NASDAQ: FAST) is down -2.8% at $45.48; Goldman Sachs Group Inc. (NYSE: GS) is up 7.5% at $105.03; and State Street Corp. (NYSE: STT) is down -7% at $39.72.

Other standouts from today include the following stocks:

Euro Tech Holdings Co. Ltd. (NASDAQ: CLWT) is up nearly 53% at $3.91. The Hong Kong-based company has announced an 11-for-2 reverse stock split.

Net 1 UEPS Technologies Inc. (NASDAQ: UEPS) is up more than 33% at $8.96. The South African software maker has announced a 5-year deal with the government’s social security agency.

Majesco Entertainment Co. (NASDAQ: COOL) is down more than -27% at $2.17. The video game maker forecast higher sales and marketing costs in 2012.

Ku6 Media Co. Ltd. (NASDAQ: KUTV) is down nearly -18% at $2.71. The Chinese online video company rose more than 150% yesterday on the announcement of deal with Google. Today’s fall is likely due to profit-taking.

We also noted 10 stocks that posted new all-time highs today. These include Apple Inc. (NASDAQ: AAPL), McDonald’s Corp. (NYSE: MCD), and Nike Inc. (NYSE: NKE). See our coverage here.

Stay tuned for Thursday. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – Consumer price index
8:30 a.m. – Housing starts
8:30 a.m. – Initial unemployment benefits claims
10:00 a.m. – Philadelphia Federal Reserve business outlook survey
10:30 a.m. – EIA weekly natural gas inventory report
11:00 a.m. – EIA weekly petroleum status report
4:30 p.m. – Federal Reserve balance sheet and money supply

Paul Ausick

Filed under: HI/LOW, Market Close, The Day Tagged: AAPL, CCL, CHK, CLWT, COOL, CREE, FAST, GOOG, GS, KR, KUTV, LNG, MCD, NKE, SCHW, STT, UEPS

Top Analyst Upgrades & Downgrades (CCL, CHK, LNG, CQP, CREE, EXPE, FTE, GOOG, JNS, KR, MGM, ODP, OMX, PVH, RL, TEF, TXT)

Administrator — Wed, 18 Jan 2012 13:28:25 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street brokerage and research firms this Wednesday morning.

Carnival Corp. (NYSE: CCL) Maintained Hold but cut estimates at Argus.
Chesapeake Energy Corporation (NYSE: CHK) Cut to Hold at Brean Murray.
Cheniere Energy Inc. (NYSE: LNG) Started as Outperform with $13.50 target at Credit Suisse
Cheniere Energy Partners, LP (NYSE: CQP) Started as Neutral with $20 target at Credit Suisse.
Cree Inc. (NASDAQ: CREE) maintained Buy with $33 target at Canaccord Genuity; Raised to Buy at ThinkEquity; Cut to Neutral at Ticonderoga.
Expedia, Inc. (NASDAQ: EXPE) Started as Underweight at JPMorgan.
France Telecom S.A. (NYSE: FTE) Cut to Sell at Deutsche Bank.
Google Inc. (NASDAQ: GOOG) Cut to Market Perform from Outperform at Wells Fargo.
Janus Capital Group, Inc. (NYSE: JNS) Cut to Sell at Citigroup.
The Kroger Co. (NYSE: KR) Cut to Market Perform at BMO Capital.
MGM Resorts International (NYSE: MGM) Raised to Neutral at Credit Suisse.
Office Depot, Inc. (NYSE: ODP) Raised to Equal-weight at Barclays.
OfficeMax Inc. (NYSE: OMX) Raised to Equal-weight at Barclays.
PVH Corporation (NYSE: PVH) Started as Neutral with $72 target at Credit Suisse.
Ralph Lauren Corporation (NYSE: RL) Started as Outperform with $168 target at Credit Suisse.
Telefonica SA (NYSE: TEF) Cut to Sell at UBS.
Textron Inc. (NYSE: TXT) Cut to Neutral at JPMorgan.

If you enjoyed the top analyst calls, you can sign up in the box below to join our morning email list to receive news directly in your inbox each morning. We include major analyst upgrades and downgrades, IPO and M&A news, special situation developments, observations on Warren Buffett and key market gurus, as well as special exclusive feature stories.

JON C. OGG

Filed under: Analyst Calls Tagged: CCL, CHK, CQP, CREE, EXPE, FTE, GOOG, JNS, KR, LNG, MGM, ODP, OMX, PVH, RL, TEF, TXT

Battle Lines Drawn Over Natural Gas Exports (DOW, DD, XOM, CHK, LNG)

Paul Ausick — Thu, 22 Dec 2011 13:44:41 +0000

Natural gas prices in the US rose to more than $4.80/thousand cubic feet (tcf) in June, and have trailed off to under $3.20/tcf today. In late 2005, natural gas spot prices topped $15/tcf and in the summer of 2008, spot prices rose above $13/tcf. The collapse is entirely due to the development of shale gas.

Big users of natural gas, like chemical companies Dow Chemical Co. (NYSE: DOW) and E.I. du Pont de Nemours & Co. (NYSE: DD), want the price of natural gas to stay low. Producers like Exxon Mobil Corp. (NYSE: XOM) and Chesapeake Energy Corp. (NYSE: CHK) would like to see prices rise. And there’s at least one company that would like to help the producers boost prices — Cheniere Energy, Inc. (AMEX: LNG).

Cheniere’s original plan was to build an import facility in the Gulf of Mexico to convert liquefied natural gas (LNG) back to a gas and pipe it onshore for sale. The boom in shale gas production killed that idea, but the company’s plant at Sabine Pass is built and now the company wants to convert the plant to an export facility that would liquefy US-produced natural gas, load the LNG onto tanker ships, and send it to Japan or India or Korea where prices are nearer $13/tcf than $3/tcf.

The Wall Street Journal has a story today about resistance to Cheniere’s export plan because it would almost certainly raise domestic natural gas prices. Unlike oil, natural gas is primarily a regional product and its sale depends on pipelines connecting regional producers with regional customers. The development of liquefied gas plants has not yet had much impact on regional pricing, but if the US continues to find and develop shale gas reserves, producers will need to find additional markets.

Big consumers of domestic natural gas want the prices to remain low, and are gearing up for a campaign against US liquefaction facilities. The battle lines are being drawn over jobs, with Dow, for example, arguing that higher natural gas prices will lead to a loss of US manufacturing jobs. The energy companies argue that export facilities will create construction and production jobs.

The US Department of Energy is studying the issue and is expected to release a report in the next few weeks analyzing the effect of exports on domestic supplies and pricing. Depending on the conclusions of that report, one side will claim government interference in the market and the other will claim vindication. Stay tuned.

Paul Ausick

Filed under: Oil & Gas, Regulation Tagged: CHK, DD, DOW, LNG, XOM

Rare 52-Week Highs During Weak Market (FUN, LNG, HITK, MGAM, SPPI, TASR)

Administrator — Tue, 22 Nov 2011 17:17:34 +0000

Outside of those crazy inverse and negative-inverse ETFs, it is odd when you see non-M&A stocks hitting 52-week highs during a multi-day broad market sell-off. This is a time when investors are skittish over international news out of Europe ahead of a time when most market participants are taking a 4-day or even 5-day holiday. Still, here are a few…

Cedar Fair L.P. (NYSE: FUN) hit a year high of $22.78 today and shares are up1.4% at $23.40. Jim Cramer touted this one on Monday evening as having no real Europe and international exposure.

Cheniere Energy, Inc. (AMEX: LNG) is surging on news of its new 20-year supply pact. While shares are “only” up 3.4% at $11.87 on double the normal volume.

Hi-Tech Pharmacal Co., Inc. (NASDAQ: HITK) hit a $39.50 year high today and shares are currently up 4.4% at $39.39.

Multimedia Games Inc. (NASDAQ: MGAM) is up 3.75% at $7.20 and the stock hit a high of $7.24 after earnings.

Spectrum Pharmaceuticals, Inc. (NASDAQ: SPPI) is up 2.5% again at $13.17 and shares hit a new high of $13.22 on continued interest after yesterday’s news that the FDA simplified the approval for Zevalin.

Taser International, Inc. (NASDAQ: TASR) hit a year high of $6.11 today and shares are up 2.9% at $6.04 in mid-day trading.

JON C. OGG

Filed under: HI/LOW, Trading Alert Tagged: FUN, HITK, LNG, MGAM, SPPI, TASR