Equinor: King Of EU Gas Is Robustly Undervalued

Nov. 29, 2022 9:48 AM ETEquinor ASA (EQNR)COP, CVX, STOHF, XOM25 Comments
Michael Fitzsimmons profile picture
Michael Fitzsimmons
19.66K Followers

Summary

  • Norway's Equinor has been supplying the EU with natural gas for decades and is now benefiting from higher prices due to Putin's weaponization of nat gas supplies from Russia.
  • While the price of NBP Gas (UK National Balancing Point) has come down significantly from its dramatic highs earlier this year, it's still greater than ~3x the 10-year average.
  • Meantime, Equinor continues to advance its burgeoning offshore wind business as it pursues its goal to become "net-zero" by 2050.
  • Along the way, EQNR is throwing off strong free-cash-flow and will benefit for many years from being what Russia isn't: a secure & reliable source of nat-gas for the EU.
  • In addition - and somewhat irrationally - Equinor is significantly undervalued compared to three of its big US-based O&G peers.
Gas burning with blue flames on the burner of a gas stove

HJBC

Norway-based Equinor (NYSE:EQNR) has been a major supplier of natural gas to the EU for many decades and, as you know, that supply became much more valuable after Russia's war on Ukraine and the resulting decision to cut-off natural gas supplies

This article was written by

Michael Fitzsimmons profile picture
19.66K Followers
Technology stocks, ETFs, portfolio strategy, renewable energy, and O&G companies. Primary goal is growing net-worth. I typically allocate a portion of my own portfolio and devote some of my SA articles to small and medium sized companies offering compelling risk/reward propositions. I am an Electronics Engineer, not a qualified investment advisor. While the information and data presented in my articles are obtained from company documents and/or sources believed to be reliable, they have not been independently verified. Therefore, I cannot guarantee its accuracy. I advise investors conduct their own research and due-diligence and to consult a qualified investment advisor. I explicitly disclaim any liability that may arise from investment decisions you make based on my articles. Thanks for reading and I wish you much investment success!

Disclosure: I/we have a beneficial long position in the shares of COP, XOM, CVX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: I am an electronics engineer, not a CFA. The information and data presented in this article were obtained from company documents and/or sources believed to be reliable, but have not been independently verified. Therefore, the author cannot guarantee their accuracy. Please do your own research and contact a qualified investment advisor. I am not responsible for the investment decisions you make.

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