Tellurian, Incorporated is a company that engages in natural gas production and investments in projects involving natural gas. Recent forecasts for the strength of the stock show it had some strong days early in 2022. Some investors are eyeing the stock as a possible long-term investment strategy. While any stock investment represents a calculated risk, how risky is Tellurian stock, and is it a solid option for long-term investment portfolios? The traditional method for estimating risk and potential for gain is to examine the history of the company, its current financial status, stock performance, and analyst opinions. It's essential to determine if a stock is right for your investment strategy based on the known facts and current assumptions based on educated guesses. We look at the facts to give you current information about Tellurian Inc to discuss with your financial advisor.
Tellurian, Inc Company profile
Tellurian Inc is a natural gas producer and investor in natural gas products. It maintains a portfolio of projects including infrastructure assets, production, and liquefied natural gas marketing. Headquarters for Tellurian Inc is in Houston, Texas. The company has been in operation since 1957. To its credit, Tellurian Inc has weathered decades of rough economic times. It's listed under the stock ticker symbol TELL. TELL also holds an LNG terminal facility and pipeline in Louisiana, according to CNN.
12-month trends for TELL stock
When compared with the performance of TELL Stock over its competitors, Tell experienced a one-year change of +127.86%, compared to Whiting Petroleum Corporation's +83.71, and Enerplus Corporation's +132.14%, the latter of which is outperforming on a daily spot check and a year-over-year analysis. The Major Benchmark of the INX S&P Index's 1-year change is +0.57 with the INDU Dow Jones Industrial Average -2.55%.
Tellurian Inc is in a solid position to gain from the changing demand for liquefied natural gas in the United States. Changes in the world's political scene with the Russian conflict in Ukraine, economic sanctions against the natural gas-supplying country, and prohibition of the import of natural resources, places TELL in a strong place in the industry. President Biden committed to finding ways to supply Europe with natural gas to reduce their dependence on Russian resources. Supplying Europe with LNG further sweetens the pot for investor confidence in natural gas stock investments. The forecast is for demand for LNG to increase, which could be good news for investors, but it's not the only consideration. Although there is still market volatility, investors currently favor natural gas stock investments because of the outlook. It's one more plus for TELL stock, but there's much more to weigh.
Is Tellurian Inc profitable?
Seeking Alpha confirms that Tellurian is an old established company that has been in operation for nearly 70 years. It's not going anywhere, but the company remains unprofitable. Analysts point out that revenues increased by $73 million in 2021, but the losses incurred were over 100%. Tellurian is taking steps to address the situation to gain a lead on its competitors. Tellurian has plans to construct a new LNG terminal called the Driftwood LNG Terminal. The estimated cost is $12 billion with Tellurian receiving financial assistance for financing the project. It's expensive, but with the green agenda being pushed forward, other investors are willing to pitch in on the cost to help further natural gas over fossil fuels. It's a move toward transporting LNG through physical infrastructure, but it will be years before the cash flow becomes positive from the venture. The building is planned to commence in stages to distribute the cost. At this stage of the game, TELL grows its revenues but at substantial operating losses, putting the company upside down on its profit and loss statement.
Shareholders have a positive outlook for TELL stocks to rise, and the speculation is likely correct. TELL stock is postured to get in on rising demand for natural gas with every reason to believe that demand will continue to rise. Over the past five years, TELL stock stayed on the ground with the lowest prices for shares at around $0.70. Investors continue to favor TELL stock at the present but there is no way to predict if the positivity will continue. Prices of TELL stock have soared recently, and the year-over-year price is up. Analysts favor a continued rise in prices. Periods of doubt and fear due to the volatility of the shares could result in fluctuations. Growth rates in Tellurian's revenue have a history of wide swings. It was down by 6% in the fourth quarter of 2022. Prices of TELL stock rose 6% in the first quarter of 2021. The initial increase was followed by a 301% gain in the second quarter. Stock prices rose 10% in the third quarter and 150% in the fourth quarter of 2021.
Pros of TELL stock
Tellurian is an old and established company that will likely persist for many more years. It supplies natural gas to customers across the globe. The demand is expected to continue to rise for LNG products with the United States on track to supply up to ten percent of the European supply previously purchased from Russia before economic sanctions were imposed. The revenues of TELL are also expected to increase. Investor confidence inTellurian is high with a positive outlook. Analysts at Seeking Alpha give TELL stock odds of 65% in favor of finishing higher than current trading by the end of 2022, but the 35% chance of finishing lower still exists. Their outlook suggests the stock could go up between 30 to 100% with a favorable opinion for long-term investment, albeit guarded as a speculative endeavor.
Other analyst opinions of TELL stock potential
Stock Invest Analysts assessed Tellurian Inc stock on May 3, 2022, remarking on its 6.38% gain with an increase in price from $4.86 to $5.17 per share with a =n 8.07% fluctuation. The stock is down by 11.47% over ten days with volume falling under 6 million shares. The falling volume of shares could be an indication of divergence that could signal a slowing of the increase, or it could signal a market trend shift. Experts predict TELL stock to rise 92.85% in the next 90 days to arrive at a holding price from $9.48 to $14.68 per share by the end of the quarter. Current share prices at $5.07, in a spot check, lead investors who follow these calculations and predictions to view TELL stock as a solid investment for the next three months and possibly beyond.
Point of concern for TELL stock
Not all the observations about TELL stock are sunny. A decent analysis weighs the potential for profit with attention to points that elicit concern. Experts warn of a red flag as insiders sold more stocks than they're purchasing. Is it possible they know something that others do not? The last 100 trades as of May 3, 2022, show insiders purchased 1.16 million shares of TELL stock and sold 12.68 million of them. It's an item to keep your eye on. Although there are positive indicators for TELL stock, the negatives bring down the confidence of Stock Invest analysts, who recommend moving the stock from hold and accumulate to a candidate for selling, based on insider trading behaviors and high volatility of 9.48%.
Is Tellurian a risky stock?
Investor Place weighs the pros and cons of the penny TELL stock which has experienced exceptional performance in the past twelve months. The company is prepared to move ahead with an expensive construction project that will make it increasingly hard to build value and profitability. The proposal of a $12 billion project may be a brilliant move for the future. It assumes risks and further declines into higher operating expenses and losses, regardless of gains in revenue. Tellurian, one could argue, is making the right moves and at the right time in its history. Their plans to build a low-cost global natural gas business for the international community and its portfolio of natural gas production resulted in almost 100 drillable areas with a trillion cubic feet of its resource. The proposed trading operation with its expensive infrastructure and export facility is worthy of consideration. The associated pipeline could create value for its shareholders through Driftwood LNG. We must weigh the proposed value creation for the future with the increase in operating losses, highlighting its profitability over the past five years. Tellurian engaged in stuck dilution for operations funding. The number of outstanding shares has been on the rise from 2018 to the present. Insiders selling more stock than they're purchasing give us another view of the larger picture to consider. Shareholders' value is harmed by Tellurian's history of negative free cash flow.
Is the Tellurian stock a solid bet as a long-term investment?
Analysts offer two main points of consideration when determining if TELL is a sound investment for the long term. It's essential to weigh the risk factors against the potential for gain. Professional stock analysts agree on the posturing of TELL stock with its pros and cons. It offers a high potential for gain under certain scenarios playing out. The sunny outlook combined with the outlay of cash required for the Driftwood project will add an element of uncertainty and higher risk to stock performance. It's a pricey stock for its valuation and a potential further stock offering necessary for funding the development of the Driftwood project, harming the value of TELL shares. We can observe reasons for investing in TELL stock. We also find reasons to sit back and watch the stock before committing. The stock will likely prove to be a wise short-term investment, especially love the next ninety days based on speculative predictions of TELL stock's potential performance. When we look at the inclusion of a stock in a long-term investment strategy, we also observe factors predicting its potential for performance and increase in shareholder value over time. It's impossible to predict what the future holds for Tellurian and its valuation. Many questions will remain unanswered over the next several months, and possibly years. Tellurian prepares to enter into the first phase of Driftwood LNG's development, hence, harming operational statements and prolonging its unprofitable status. We temper these facts with the high likelihood that revenues will go up as additional expenses incurred will also rise at a faster rate. We must conclude that there's a bit too much uncertainty to accurately predict its benefit for inclusion n a long-term investment portfolio.
Analysts view the stock as having a high potential of bringing investors returns over the next three months and beyond. They put the odds at 65%. The risk of 35% potential for things to go the other way still exists as confirmed according to popular forecasting models employed. We conclude that TELL stock is a risky investment in natural gas stock because of extraneous factors. The prospects for the future of natural gas are exceptional with demand increasing over the next foreseeable months to come, however, Tellurian is engaging in activities that could either build shareholder value over time or diminish it. Some experts warn that it's time to sell. They base the recommendation on observed insider activities, yet some investors are confident and buying stock. Investor behaviors may influence the price of TELL stock over the next twelve months. Prices are low now and projected to rise, making TELL stock consideration for the investor willing to take the risk that prices will continue to rise. It's a stock worth keeping your eye on. It's recommended that you consult with your financial advisor about the risks and potential benefits of a long-term investment in TELL stock.
Written by Allen Lee
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