Today I’m looking into a new Alex Green pitch centered around a company that ships LNG (liquefied natural gas) to Europe.
In short, Green talked about how Putin has made an “epic blunder” by recently cutting off Europe’s gas supply, and he believes that this has created “the single most obvious, predictable and potentially profitable opportunity” he’s seen in 40 years.
“I believe Vladimir Putin has stepped headfirst into the most epic blunder of his life.
“He’s already turned himself and his country into the world’s biggest villains with the invasion of Ukraine.
“But his latest mistake is going to be what ends up doing him in for good.
“It has created perhaps the single most obvious, predictable and potentially profitable opportunity I’ve seen in 40 years in the markets.
“In fact, I’ve already seen Wall Street analysts bump their price targets on this investment to $280… from around $30 today.”Source: https://pro.oxfordclub.com/p/PUTINTO99OXFLT2YRDSOPRLT/EOXFYAJL/Full
If you’ve seen the teaser, you’ll know that Green didn’t reveal his LNG pick in the presentation. He instead reveals it in a PDF report called “The New King of LNG,” which comes with a $49 subscription to his flagship service, The Oxford Communique.
But I think I know what stock he’s teasing. So let’s unpack Green’s prediction and look into the clues he shared to see what company might be a match.
What Is Alex Green Predicting?
Alex Green’s latest prediction is that 12-to-18 months from now, a “handful of smart Americans” could see “nearly tenfold gains in less than 18 months” as a result of what he describes as “Vladimir Putin’s stupidity.”
“My belief is that between a year and 18 months from now… a handful of smart Americans are going to do very well because of this.
“We’re talking about nearly tenfold gains in less than 18 months.
“Friends will go up to them and ask, ‘What happened? How are you doing so well in this market?’
“And they’ll answer, ‘Vladimir Putin’s stupidity made me rich!'”
The “stupidity” Green’s referring to largely revolves around how Russia shut down the Nord Stream 1 pipeline to Germany recently, which has left Europe in a difficult situation.
In short, Green talked about how Europe has focused on building its “green energy” economy in recent years and, in the process, become “completely dependent on Russian fuel.”
And now, with Russia halting the EU’s supply of gas, he pointed out that natural gas prices have “skyrocketed,” power outages have become increasingly common in the EU, and various industries have been negatively impacted.
All of which he describes as a “major, major problem.”
The “answer” to which, according to Green, is America.
“Bob, this is all a major, major problem.
“This domino effect… stemming from Putin’s decision to cut off the pipeline… threatens not just the European economy, but the entire world economy.”
“While everything I’ve explained to you is dire… there is a solution to this problem.
“What I’ve outlined is what could happen if Russia shuts off Europe’s energy and nothing replaces it.
“But what Putin failed to recognize… is that there is a replacement for Russian gas.
“It’s a way for Europe to get all the energy they need.
“And it’s a way for investors to make a ton of money in a very short period of time.
“The answer, in short, is…
Why does he think America is the answer?
As Green pointed out, not only are natural gas prices way lower in the U.S. than in Europe, but America is “the world leader in producing cheap natural gas.”
The problem, however, is getting natural gas from the U.S. to Europe because, unlike Russia, the U.S. doesn’t have a pipeline to send gas to Europe.
And that’s where LNG comes in.
In short, natural gas can be liquified through a special cooling process, which according to Wikipedia, “takes up about 1/600th the volume of natural gas in the gaseous state.”
And from there, the gas can be transported.
Of course, LNG isn’t a new thing. But given the price difference in gas between the EU and U.S., the need for the EU to fill the supply gap left by Russia, and other factors he discussed, Green suggests that LNG could be the answer.
Furthermore, Green is predicting that Western Europe will “never” go back to Russian gas, given how unreliable it has proven to be, and that they are instead “buying up every shipload of LNG that comes to port” while securing long-term contracts.
“Western Europe is NEVER going back to Russian gas.
“Even if Putin exited Ukraine tomorrow, got down on his knees and begged for forgiveness… there’s no way Europe would ever do business with him again.”
“… they’re buying up every shipload of LNG that comes to port.
“To make sure they never have to go back to Russian gas, the European governments are locking in long-term contracts at fixed prices for years to come!”
How does the company Green’s teasing fit into all of this?
To answer that, let’s take a closer look at what he said about it.
Green’s “The New King of LNG” Stock Pick Revealed
According to Alex Green, the company he’s teasing has 13 ships delivering LNG around the world, 12 of which are “under fixed contracts.”
“This company has 13 ships delivering LNG around the world.
“And 12 of them are now under fixed contracts… with LNG prices locked in for between three and 10 years.
“In total, the company has 54 combined years of LNG delivery locked in for the 13 ships they operate.”
It’s unclear how many of those contracts are specifically related to Europe, but he basically put forth the notion that the company has plenty of business ahead of it.
He also talked about a so-called “breakthrough” that the company has developed, which he says “dramatically reduces the cost of the entire journey.”
“As I said before, during transportation, liquefied natural gas will boil off when some of it turns from liquid back into a gas.
“In the past, that gas would be lost.
“But these ships instead have been built to actually capture and RUN on the natural gas that boils off.
“This dramatically reduces the cost of the entire journey.”
Based on that, we know that Alex Green is pitching a company that transports LNG to Europe and other parts of the world via its fleet of 13 ships.
Aside from that, Green revealed that the stock he’s teasing “trades for about $30 today,” said that its “dividend yield is over 10% right now,” and shared numerous other hints.
Here’s an overview of the main clues he shared:
“As the CEO of this company says…
“‘Europe has been gobbling up LNG spot cargos on an unprecedented level.'”
“The company is paying a monstrous dividend of over 10%… and they are likely to increase it even more in the days ahead!”
“The company right now has 100% contract coverage until mid-2024 at the earliest.”
“This company trades for about $30 today… but MarketBeat is putting its price target at $280 for the next year to 18 months.”
“The company has a $284 million cash balance ready for any emergency.”
“Retail investors may not understand the enormity of this opportunity.
“But the insiders running the business surely do.
“They own a whopping 47% of all outstanding shares!”
There were also other clues Green shared about the company, like quotes from the CEO and details about its financials, but the above hints were more than enough to solve this one.
Long story short, it looks like Alex Green is teasing FLEX LNG Ltd. (FLNG), a Bermuda-based LNG shipping company with a fleet of 13 “fifth generation LNG carriers.”
I can’t say for sure that this is Green’s pick (since I haven’t read his “New King of LNG” report), and I haven’t verified every single clue he shared, but it looks like a match.
Here’s a quick breakdown of why I say that:
- For starters, this page on Seeking Alpha shows that the above “Europe has been gobbling up LNG” quote Alex Green shared was something FLEX LNG’s CEO, Oystein Kalleklev, said during a recent earnings call.
- According to the same transcript I shared above, the CEO said that the company boosted its “cash balance to $284 million” at the end of the second quarter, matching another one of Green’s clues.
- According to this September 2022 company presentation, the company has “100% contract coverage until at least mid-2024,” which matches another hint.
- The company’s share price as of writing (October 2022) is sitting at just over $32 a share, and it pays an annual dividend of $3, making its current yield roughly 9.3%. That’s a little lower yield than Green said, but it was closer to 10% when it was trading at $30, which is the price Green mentioned in the presentation.
- According to Yahoo Finance, the percentage of shares held by “insiders” is just over 47%, matching yet another Alex Green clue.
So, to sum it up, FLEX LNG looks like a match.
I won’t speculate on whether or not I think it’s a good investment, as that’s way beyond my area of expertise, but I’m willing to bet that this is the company he’s pitching.
If you wanted to know for sure, however, you’d need to join his Oxford Communique service, which costs $49. This gives you access to his “New LNG King” report, existing stock picks, and ongoing newsletters where he shares his latest insight and recommendations.
Recommended: Go here to see my #1 rated stock advisory of 2023
Alex Green’s LNG stock teaser reminded me of one I recently wrote about from a different stock picker (Whitney Tilson), which focused on a similar idea.
Tilson appears to be teasing a different company, but the general idea both Green and Tilson put forth is similar… that Europe needs an affordable, reliable supply of natural gas and that LNG from America could be the solution.
Regardless of your views on the fossil fuel industry, as we’ve seen, they are essential to keeping the lights on and industries running in Europe. And that supply needs to come from somewhere, which is more or less the point Green made in the teaser.
So in that respect, I think he makes a good point.
But that doesn’t mean the company he’s recommending will make you money, as there are always risks associated with investing. And there are many different factors to consider. Which is why I’m a big believer in always doing your own research on this stuff.
I wasn’t able to find much in the way of independent analysis on the company Green appears to be teasing (FLEX LNG), but this CNBC article may be worth a read if you want to further your research on the state of the European LNG market in general.
In short, the article points out that the U.S. is indeed exporting more LNG to Europe due to Russia’s war in Ukraine. However, it also says that there has been a “buildup of LNG vessels waiting to unload at ports” in Europe, as European infrastructure has been “unable to handle the increased LNG shipments.”
The article also points out that European gas prices have been falling recently and says that, despite this, EU leaders have been discussing potential price caps.
Only time will tell what impact (if any) these things will have on Alex Green’s prediction, but at the very least, I think that article shows that there are always different things to consider when evaluating a given investment.
Anyway, that’s it from me.
Let me know what you think about all this in the comments section below.