Why a Fund Reduced Its LNG Exposure by 118,000 Shares Despite Long-Term Contracts
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The sale highlights how even cash-rich LNG operators with long contracts can fall out of favor when capital cycles shift.Austin-based Beck Capital Management disclosed a reduction in its stake in Golar LNG Limited (GLNG +0.15%), trimming 117,966 shares in the third quarter, contributing to a reduction in the position value by $4.9 million, according to a November 14 SEC filing.What HappenedAccording to a filing with the Securities and Exchange Commission dated November 14, Beck Capital Management sold 117,966 shares of Golar LNG Limited (GLNG +0.15%) during the third quarter. The stake decreased from 172,826 shares to 54,860 shares, with a $4.9 million reduction in position value over the period. GLNG now represents 0.5% of the fund’s $433.8 million in reportable U.S. equity holdings.What Else to KnowTop five positions after the filing: NASDAQ: NVDA: $32.3 million (7.5% of AUM)NASDAQ: META: $16.1 million (3.7% of AUM)NASDAQ: AVGO: $14.5 million (3.4% of AUM)NASDAQ: MSFT: $14.5 million (3.4% of AUM)NYSE: VRT: $11.6 million (2.7% of AUM)As of Thursday, shares of Golar LNG Limited were priced at $36.99, down 9% in the past year and underperforming the S&P 500, which is up 15% in the same period.Company OverviewMetricValuePrice (as of Thursday)$36.99Market Capitalization$3.8 billionRevenue (TTM)$326.6 millionNet Income (TTM)$59.8 millionCompany SnapshotGolar LNG Limited designs, builds, owns, and operates marine infrastructure for the liquefaction and regasification of LNG, including LNG carriers, floating liquefaction vessels (FLNG), and floating storage regasification units (FSRUs). The company generates revenue primarily through long-term charters and the operation of LNG carriers and FLNG assets, focusing on the midstream segment of the LNG value chain. It serves global energy companies, utilities, and industrial customers seeking flexible LNG transportation and processing solutions.Foolish TakeGolar’s business has shown itself to reliably produce long-term contracts, yet its shares remain far below prior cycle peaks. That disconnect helps explain why portfolio managers may rebalance exposure even while fundamentals improve. In the latest quarter, the company reported $31 million in net income attributable to shareholders and $83 million in adjusted EBITDA, supported by long-term FLNG charters that stretch 20 years and underpin an adjusted EBITDA backlog of roughly $17 billion. Liquidity remains strong, with $661 million in total cash at quarter-end, and management authorized a new $150 million share buyback while maintaining a $0.25 quarterly dividend. These are not signals of distress.Still, Golar sits in a portfolio dominated by mega-cap technology names like Nvidia and Microsoft, where growth narratives are simpler and capital intensity is lower. LNG infrastructure requires patience, tolerance for leverage, and comfort with commodity exposure, even when revenues are largely contracted. Trimming a sub-1% position can reflect risk management rather than a loss of conviction. For patient investors, Golar remains a cash-generating infrastructure play with unusually long visibility. The challenge is whether markets will reward that stability anytime soonGlossary13F reportable assets: Assets reported by institutional investment managers on SEC Form 13F, disclosing their U.S. equity holdings.Assets under management (AUM): The total market value of investments managed on behalf of clients by a fund or firm.Position value: The total market value of a specific investment holding within a portfolio.Stake: The ownership interest or number of shares held in a particular company by an investor or fund.Top five holdings: The five largest investments in a fund’s portfolio, typically by market value.Floating liquefaction vessel (FLNG): A ship-based facility that converts natural gas into liquefied natural gas (LNG) at sea.Floating storage regasification unit (FSRU): A ship that stores LNG and converts it back into gas for delivery to shore.LNG carrier: A specialized ship designed to transport liquefied natural gas (LNG) across oceans.Midstream segment: The part of the energy industry focused on transportation, storage, and processing of oil and gas products.Charter: A contract to lease a vessel, such as an LNG carrier, for a specified period and purpose.TTM: The 12-month period ending with the most recent quarterly report.About the AuthorJonathan Ponciano is a contributing stock market analyst at The Motley Fool. He has nearly a decade of experience as a financial journalist, most recently as an editor and senior reporter at Forbes focused on markets, technology, and entrepreneurship. Jonathan has also written for Investopedia and the Los Angeles Business Journal. He holds a dual B.A. in Business Journalism and Economics from the University of North Carolina at Chapel Hill and an M.B.A. from Columbia Business School. A North Carolina native now based in New York City, Jonathan has also lived in Mexico City and Los Angeles.CMFjonponcStocks MentionedGolar LngNASDAQ: GLNG$37.06 (+0.00%) $+0.06*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.Advertisement