What is NextDecade Corporations ?

NextDecade Corporation is involved in the development of liquefied natural gas (LNG) liquefaction and sale, as well as the capture and storage of CO2 emissions. It focuses on the Rio Grande LNG terminal facility in the Port of Brownsville in southern Texas, as well as a carbon capture and storage (CCS) project at the terminal and other CCS projects with third-party industrial source facilities. The company was established in 2010 and is headquartered in Houston, Texas.


Company Financial Performance Summary

NextDecade Corporation has reported earnings for the fiscal year ending December 31, 2022. The corporation reported a net loss of USD 60.07 million for the fiscal year, up from USD 22.04 million the previous year. The basic loss per share from continuing operations was USD 0.65 in comparison to USD 0.34 the previous year. The diluted loss per share from continuing operations was USD 0.65 in comparison to USD 0.34 the previous year.

NextDecade Stock Evaluation

According to Zacks, NextDecade Corporation has a Zacks Rank of 2 and is expected to perform above average in the stock market in the coming months. However, its VGM Score is D, which is an average of individual Style Scores. Valuation metrics suggest that the company may be overvalued, and it would not be a good choice for value investors with a Value Score of F.

In terms of financial health and growth prospects, NEXT has a Growth Score of D and may underperform the market. The recent price changes and earnings estimate revisions make this stock suitable for momentum investors, with a Momentum Score of A.

Why did NEXT increase recently ?

The news that the developer of a liquefied natural gas (LNG) project had reached an agreement with a Chinese company to buy LNG from its prospective Rio Grande LNG project sparked the rally. It is a significant step for the company.

NextDecade has committed to buy 1.5 million metric tons of LNG per year from China’s Guangdong Energy Company. The 20-year contract calls for it to purchase LNG from train one of the terminal, which is expected to begin operations in 2026. It will join Royal Dutch Shell as NextDecade’s second foundational customer.

Is NextDecade Corp Stock a Buy now?

NextDecade, on the other hand, has a long way to go before making that decision. The first two trains would have an annual capacity of 11 million metric tons of LNG. To justify the investment, the majority of that capacity must be reduced. Rio Grande LNG will eventually have a capacity of 27 million metric tons per year.

Obtaining contracts is only the first step. To finance the project and the associated carbon capture and storage system, the corporation will also need to raise billions of dollars in money. This would allow the corporation to provide low-carbon LNG to clients in order to assist them reach their climate goals.

While the corporation has a lot of work ahead of it, there are reasons to be positive. According to Shell’s 2022 LNG forecast, a significant supply-demand gap will appear by the middle of this decade. Rio Grande LNG would come online at that time, giving it a feasible possibility to bridge the gap. Hence, if NextDecade can get enough contracts and financing to continue forward with Rio Grande LNG, the shares of NextDecade could have tremendous upside potential.

There is also a significant risk. As a result, investors may wish to wait for more clarification on Rio Grande LNG’s future before purchasing shares.


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