According to Jim Cramer, these three LNG plays are worth considering as investments.

According to Jim Cramer, these three LNG plays are worth considering as investments.
According to Jim Cramer, these three LNG plays are worth considering as investments.
  • On Tuesday, CNBC's Jim Cramer recommended three liquified natural gas stocks for investors to buy.
  • The "Mad Money" host stated that two companies are focused on liquefied natural gas exports, which are riskier, while the third company offers a more diversified story, making it ideal for home-gamers concerned about volatility.
These three LNG plays are worthy investments, Jim Cramer says

On Tuesday, CNBC's Jim Cramer recommended three liquified natural gas stocks for investors to buy.

The "Mad Money" host stated that two companies are focused on liquefied natural gas exports, which are riskier, while the third company offers a more diversified story, making it ideal for home-gamers concerned about volatility.

The ongoing Russian invasion of Ukraine has prompted the U.S. to express concerns about the limited availability of commodities, such as energy and food, and to impose economic sanctions on Russia. In March, the U.S. announced that it would collaborate with international partners to increase the supply of liquified natural gas to Europe by at least 15 billion cubic meters this year, in an effort to reduce dependence on Russian imports.

On Tuesday, U.S. natural gas futures experienced a 6% increase, reaching a nine-week high.

According to Reuters, front-month gas futures increased by 5.6% to $6.032 per million British thermal units (mmBtu), reaching their highest close since January 27.

Cramer's top three LNG stocks for investors to consider include his favorite.

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Cramer stated that Sempra Energy is not a pure play, but has a significant LNG export business.

Sempra Energy is the best option for playing Europe's demand for liquefied natural gas, according to him. He stated that the company's stock is still undervalued in relation to its earnings, and he believes it will perform consistently in the long term.

Cramer mentioned two other LNG stocks that he believes are investable: Cheniere Energy and Tellurian.

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Cramer stated that Cheniere is the safest pure play in the industry, with analysts predicting its sales and earnings to peak this year. If the LNG business continues to thrive beyond 2022, Cramer recommends buying the stock. However, if the good news is already priced in and the market is not great, it may not be a wise investment.

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Cramer advised waiting for a better entry point as the stock has doubled since the end of last year, implying that patience is necessary.

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by Krystal Hur

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