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re: Venture Global NYSE Release
Posted on 12/15/25 at 8:14 pm to K E V 8 4
Posted on 12/15/25 at 8:14 pm to K E V 8 4
Cont'd 3 of 3 Bull and Bear Cases
### The Bull Case (Why It Could Rebound Strongly)
- **Assets are massively undervalued relative to invested capital** — The company has poured ~$43B+ into facilities (Calcasieu Pass fully operational, Plaquemines nearly complete with 34+ trains producing and final blocks in commissioning). At a ~$15B market cap, you're essentially buying world-class LNG infrastructure at ~0.35x book value. If execution delivers and disputes resolve favorably, this discount could close dramatically.
- **Ramp-up at Plaquemines is progressing** — Recent filings show the plant is ~99% constructed, with commissioning cargoes funding the final push. Management guides for strong 2025–2026 cargo volumes, and they've been signing new long-term SPAs (e.g., Tokyo Gas, Naturgy) despite the noise.
- **Cash flow inflection ahead** — Q3 showed explosive EBITDA growth, and 2025 guidance remains $6.35–6.5B. They've refinanced aggressively ($3B notes in December alone) and even initiated a small dividend (~1% yield), signaling confidence in near-term liquidity.
- **Analyst targets imply big upside** — Even after cuts, average PTs are in the $9–11 range (some higher), suggesting 50–75% potential from here if sentiment flips.
### The Bear Case (Why It's Still Risky and Could Go Lower)
- **Legal overhang is real and ongoing** ? BP won a $1B+ arbitration in October, Shell is appealing its loss and accusing VG of a "campaign" against them. Total exposure across cases could still run into billions, eroding trust with customers and creating headline risk.
- **Debt is heavy and margins are compressing** ? ~$30B+ in long-term debt, negative FCF from capex, and narrowing Henry Hub–global spreads (due to rising U.S. nat gas prices and softer Asian/European demand) are squeezing profitability.
- **Momentum is ugly** ? The stock's down ~75% YTD from IPO highs, with insider selling, repeated PT cuts (Citi to $9, Wells to $8, etc.), and no clear catalyst to stop the bleed short-term.
- **Broader LNG cycle risks** ? Potential oversupply wave in 2026–2027 could pressure spot/commissioning profits, which have been a big driver.
### My Overall View
At current levels (~$6.20), **VG looks like a high-conviction asymmetric bet for patient holders**—the hard assets and production growth are there, and the market is pricing in a lot of worst-case legal/debt outcomes already. Your $7.35 basis isn't far above today's price, so you're not deeply buried.
If you believe management can navigate the arbitrations (they've won some key ones like Shell initially) and deliver on Plaquemines/CP2 ramp-up, holding or even averaging down could pay off handsomely over 2–3 years as cash flows normalize and the valuation gap closes.
But this isn't a low-risk name—it's leveraged, litigious, and cyclical. If more bad arbitration news hits or debt markets tighten, it could test $5 or lower.
I'd probably **hold tight** and watch Q4 earnings (likely early 2026) for updates on damages, cargo volumes, and offtake progress. If you're risk-averse or need the capital elsewhere, trimming here to preserve gains from your lower basis might make sense. Congrats on getting in sub-$8—that was a solid entry in hindsight!
### The Bull Case (Why It Could Rebound Strongly)
- **Assets are massively undervalued relative to invested capital** — The company has poured ~$43B+ into facilities (Calcasieu Pass fully operational, Plaquemines nearly complete with 34+ trains producing and final blocks in commissioning). At a ~$15B market cap, you're essentially buying world-class LNG infrastructure at ~0.35x book value. If execution delivers and disputes resolve favorably, this discount could close dramatically.
- **Ramp-up at Plaquemines is progressing** — Recent filings show the plant is ~99% constructed, with commissioning cargoes funding the final push. Management guides for strong 2025–2026 cargo volumes, and they've been signing new long-term SPAs (e.g., Tokyo Gas, Naturgy) despite the noise.
- **Cash flow inflection ahead** — Q3 showed explosive EBITDA growth, and 2025 guidance remains $6.35–6.5B. They've refinanced aggressively ($3B notes in December alone) and even initiated a small dividend (~1% yield), signaling confidence in near-term liquidity.
- **Analyst targets imply big upside** — Even after cuts, average PTs are in the $9–11 range (some higher), suggesting 50–75% potential from here if sentiment flips.
### The Bear Case (Why It's Still Risky and Could Go Lower)
- **Legal overhang is real and ongoing** ? BP won a $1B+ arbitration in October, Shell is appealing its loss and accusing VG of a "campaign" against them. Total exposure across cases could still run into billions, eroding trust with customers and creating headline risk.
- **Debt is heavy and margins are compressing** ? ~$30B+ in long-term debt, negative FCF from capex, and narrowing Henry Hub–global spreads (due to rising U.S. nat gas prices and softer Asian/European demand) are squeezing profitability.
- **Momentum is ugly** ? The stock's down ~75% YTD from IPO highs, with insider selling, repeated PT cuts (Citi to $9, Wells to $8, etc.), and no clear catalyst to stop the bleed short-term.
- **Broader LNG cycle risks** ? Potential oversupply wave in 2026–2027 could pressure spot/commissioning profits, which have been a big driver.
### My Overall View
At current levels (~$6.20), **VG looks like a high-conviction asymmetric bet for patient holders**—the hard assets and production growth are there, and the market is pricing in a lot of worst-case legal/debt outcomes already. Your $7.35 basis isn't far above today's price, so you're not deeply buried.
If you believe management can navigate the arbitrations (they've won some key ones like Shell initially) and deliver on Plaquemines/CP2 ramp-up, holding or even averaging down could pay off handsomely over 2–3 years as cash flows normalize and the valuation gap closes.
But this isn't a low-risk name—it's leveraged, litigious, and cyclical. If more bad arbitration news hits or debt markets tighten, it could test $5 or lower.
I'd probably **hold tight** and watch Q4 earnings (likely early 2026) for updates on damages, cargo volumes, and offtake progress. If you're risk-averse or need the capital elsewhere, trimming here to preserve gains from your lower basis might make sense. Congrats on getting in sub-$8—that was a solid entry in hindsight!
1
Posted on 12/16/25 at 9:27 am to K E V 8 4
This company is trash. I've spoken in length about in another thread. I'm a buyer at sub $3, maybe
Posted on 12/16/25 at 10:11 am to K E V 8 4
quote:idk what the floor is considering VG's unethical and slimy execs. it can go pretty wayward when you're dealing with impropriety, which is hard to rule out with their current crop of c-suites.
My thesis is that the value of the assets alone should be a floor. I'm probably wrong
This post was edited on 12/16/25 at 10:12 am
Posted on 12/16/25 at 10:16 am to Louie T
Not to mention the amount of debt they have levered the company up with..
Posted on 12/16/25 at 8:33 pm to Louie T
Examples please of this bad behavior.
Posted on 12/17/25 at 11:08 am to DiamondDog
Google
The big issue is that these freaking guys, for years, said their facilities were not commercially complete. When an LNG export facility reaches completion, the contracts kick in. Before being fully commissioned, it can still produce some LNG and those are all equity volumes for the company (e.g. they own them, they buy the domestic gas and sell it internationally at an international price). Spreads were huge, so they made a ton of money. They essentially stole this money from their customers. The customers' contracts should have kicked in leaving VG with a lot less equity volumes to market.
Hope that helps mr "examples please"
BP (Lost): In October 2025, BP won a significant arbitration, with tribunals finding Venture Global failed to act as a "reasonable and prudent operator" by delaying commercial operations to sell at higher spot prices, potentially costing BP over $1 billion.
Shell (Won): Venture Global won its case against Shell in August 2025, though the reasons for contrasting outcomes with BP are unclear.
Others (Ongoing): Repsol, Galp, and Orlen have similar claims against Venture Global, with arbitration ongoing.
Securities Fraud (IPO): Class actions filed after Venture Global's January 2025 IPO allege false statements about project viability and legal challenges, according to firms like Kessler Topaz Meltzer & Check, LLP and Rosen Legal.
Employee Stock Options: Lawsuits filed by former advisors (Muller, Ruggirello) and former General Counsel (Dillbeck) claim the company blocked them from exercising stock options, reports Bloomberg.com.
The big issue is that these freaking guys, for years, said their facilities were not commercially complete. When an LNG export facility reaches completion, the contracts kick in. Before being fully commissioned, it can still produce some LNG and those are all equity volumes for the company (e.g. they own them, they buy the domestic gas and sell it internationally at an international price). Spreads were huge, so they made a ton of money. They essentially stole this money from their customers. The customers' contracts should have kicked in leaving VG with a lot less equity volumes to market.
Hope that helps mr "examples please"
BP (Lost): In October 2025, BP won a significant arbitration, with tribunals finding Venture Global failed to act as a "reasonable and prudent operator" by delaying commercial operations to sell at higher spot prices, potentially costing BP over $1 billion.
Shell (Won): Venture Global won its case against Shell in August 2025, though the reasons for contrasting outcomes with BP are unclear.
Others (Ongoing): Repsol, Galp, and Orlen have similar claims against Venture Global, with arbitration ongoing.
Securities Fraud (IPO): Class actions filed after Venture Global's January 2025 IPO allege false statements about project viability and legal challenges, according to firms like Kessler Topaz Meltzer & Check, LLP and Rosen Legal.
Employee Stock Options: Lawsuits filed by former advisors (Muller, Ruggirello) and former General Counsel (Dillbeck) claim the company blocked them from exercising stock options, reports Bloomberg.com.
Posted on 12/17/25 at 11:10 am to Texas Tea 123
Legal overhang is not the bear case though. The bear case is that these guys generally have no integrity and the fundamentals of their business are completely breaking down while they suffocate w/ debt.
Posted on 12/17/25 at 8:24 pm to Texas Tea 123
So VG fired you. Got it.
Posted on 12/18/25 at 10:09 am to DiamondDog
I work in finance and have covered LNG stocks in the past you dunce. When knowledgeable and experienced people are telling you something about a subject you know little about, it's best to listen, take the info, and make your own decisions. But go on and lose more money - that's your prerogative
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