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Why New Fortress Energy Stock Is Soaring Today

By Matthew DiLallo - Mar 16, 2021 at 3:48PM

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Several factors fueled the energy infrastructure stock's surge.

What happened

Shares of New Fortress Energy (NFE -2.65%) rallied more than 27% by 3 p.m. EDT on Tuesday. Fueling the energy infrastructure stock was its fourth-quarter results and an analyst upgrade.  

So what

New Fortress Energy reported slightly weaker-than-expected fourth-quarter results as the energy infrastructure company broke even, while analysts expected a $0.04 per share profit. However, the market overlooked that miss because of the company's optimistic outlook. 

An LNG tanker leaving a terminal.

Image source: Getty Images.

New Fortress Energy noted that it has now announced three separate growth transactions valued at $5.1 billion. These include the previously announced Hygo Energy Transition and Golar Energy Partners (GMLP) acquisitions from Golar LNG (GLNG -3.65%). It's also developing the Suape Terminal and announced a final investment decision on a floating natural gas liquefaction solution, Fast LNG. It expects that project to be operational by the end of next year. 

Those moves led Stifel to upgrade the stock from hold to buy, setting a $50 price target (though that's now $4 below the current stock price). While Stifel warns that "execution risk is still a challenge," the company has several catalysts on the horizon, making its value proposition "compelling." 

Now what

New Fortress Energy sees lots of growth ahead as it completes its recent acquisitions and development projects. Those growth drivers could continue to fuel shares of the energy infrastructure stock as long as it delivers results within expectations. However, shares could cool off if the company stumbles, which is a risk that investors should watch closely.

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Stocks Mentioned

New Fortress Energy LLC Stock Quote
New Fortress Energy LLC
NFE
$42.68 (-2.65%) $-1.16
Golar LNG Limited Stock Quote
Golar LNG Limited
GLNG
$23.77 (-3.65%) $0.90
Golar LNG Partners LP Stock Quote
Golar LNG Partners LP
GMLP

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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