Cheniere Energy Partners, L.P. (NYSE: CQP)

Sector: Energy Industry: Oil & Gas Midstream CIK: 0001383650
Market Cap 32.44 Bn
P/B -93.23
P/E 13.97
P/S 3.15
ROIC (Qtr) 21.10
Div Yield % 7.66
Rev 1y % (Qtr) 16.98
Total Debt (Qtr) 14.76 Bn
Debt/Equity (Qtr) -42.42

About

Cheniere Energy Partners, L.P., a master limited partnership (MLP), operates in the energy sector with a focus on liquefied natural gas (LNG). The company's stock symbol is CQP, and it is a subsidiary of Cheniere Energy, Inc., a publicly traded corporation involved in the liquefaction and export of LNG. Cheniere Energy Partners' main business activities encompass the production, storage, and transportation of LNG. The company operates in the United States, specifically in Louisiana and Texas, where its two liquefaction facilities, Sabine Pass LNG...

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Price action

Investment thesis

Bull case

  • Tangible assets of 16.83B provide exceptional 112.23x coverage of deferred revenue 150M, showing strong service capability backing.
  • Robust free cash flow of 2.53B exceeds capital expenditure of 225M by 11.25x, indicating strong organic growth funding capability.
  • Strong operating cash flow of 2.76B provides 26.77x coverage of SG&A expenses 103M, showing efficient operational cost management.
  • Operating cash flow of 2.76B provides strong 18.38x coverage of deferred revenue 150M, indicating service delivery capability.
  • Tangible assets of 16.83B provide robust 19.97x coverage of other current liabilities 843M, indicating strong asset backing.

Bear case

  • Operating cash flow of 2.76B barely covers its investment activities of (230M), with a coverage ratio of -11.99, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 2.76B provides thin coverage of dividend payments of (2.04B) with a -1.35 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • High receivables of 569M relative to inventory of 147M (3.87 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • High financing cash flow of (2.77B) relative to working capital of (578M), which is 4.80x suggests concerning dependence on external funding for operational needs.
  • Free cash flow of 2.53B represents just -3.59x of debt issuance (705M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Product and Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Oil & Gas Midstream
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ENB Enbridge Inc 100.05 Bn 24.60 2.15 75.15 Bn
2 WMB Williams Companies, Inc. 73.60 Bn 31.09 6.40 27.99 Bn
3 EPD Enterprise Products Partners L.P. 69.94 Bn 12.09 1.32 33.58 Bn
4 KMI Kinder Morgan, Inc. 60.62 Bn 22.23 3.69 32.58 Bn
5 ET Energy Transfer LP 58.05 Bn 13.46 0.73 63.97 Bn
6 TRP Tc Energy Corp 55.97 Bn 22.78 5.27 44.47 Bn
7 MPLX Mplx Lp 54.03 Bn 11.23 4.22 25.92 Bn
8 OKE Oneok Inc /New/ 44.55 Bn 13.34 1.41 33.73 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.80 3.39
EV to Cash from Ops. EV/CFO 17.09 7.77
EV to Debt EV to Debt 3.19 -68.56
EV to EBIT EV/EBIT 15.26 12.77
EV to EBITDA EV/EBITDA 12.62 7.47
EV to Free Cash Flow [EV/FCF] EV/FCF 18.61 13.20
EV to Market Cap EV to Market Cap 1.45 2.49
EV to Revenue EV/Rev 4.57 4.48
Price to Book Value [P/B] P/B -93.23 94.01
Price to Earnings [P/E] P/E 13.97 12.31
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.14 -3.60
Dividend Payout Ratio % Div Payout % (Qtr) 85.40 72.05
Dividend per Basic Share Div per Share (Qtr) 3.27 1.46
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 62.51 32.66
Interest Coverage Int. cover (Qtr) 4.04 5.11
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -45.16 -17.97
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -60.10 16,113.89
Dividend Growth (1y) % Div 1y % (Qtr) -11.26 -1.32
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -14.23 -5.21
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -12.12 -4.54
EBIT Growth (1y) % EBIT 1y % (Qtr) -14.23 -11.94
EBT Growth (1y) % EBT 1y % (Qtr) -16.83 -230.00
EPS Growth (1y) % EPS 1y % (Qtr) -17.28 -44.55
FCF Growth (1y) % FCF 1y % (Qtr) -11.25 -0.80
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -11.87 -1.23
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.61 0.76
Cash Payout Ratio Cash Payout (Qtr) 0.69 0.21
Cash Ratio Cash Ratio (Qtr) 0.10 0.81
Current Ratio Curr Ratio (Qtr) 0.66 1.65
Debt to Equity Ratio Debt/Equity (Qtr) -42.42 1.11
Interest Cover Ratio Int Coverage (Qtr) 4.04 5.11
Times Interest Earned Times Interest Earned (Qtr) 4.04 5.11
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 36.60 35.86
EBIT Margin % EBIT Margin % (Qtr) 29.95 27.76
EBT Margin % EBT Margin % (Qtr) 22.54 17.28
Gross Margin % Gross Margin % (Qtr) 37.30 48.56
Net Profit Margin % Net Margin % (Qtr) 22.50 15.36