We recently published a list of the 15 Energy Infrastructure Stocks That Are Skyrocketing. In this article, we are going to take a look at where LandBridge Company LLC (NYSE:LB) stands against other energy infrastructure stocks that are skyrocketing.
In January 2024, the Biden administration paused federal authorizations for several pending LNG export projects, citing concerns about environmental impacts and domestic energy security. The US Department of Energy later released an assessment indicating that increased LNG exports could add 1.5 gigatons of greenhouse gas emissions annually by 2050, equivalent to a quarter of the current emissions of the US. However, President-elect Donald Trump is set to reverse the Biden administration’s pause on liquefied natural gas (LNG) export approvals, marking a significant shift in US energy policy.
On January 1, Ukraine officially halted the transit of Russian natural gas to several European nations, marking the end of a five-year agreement and closing a chapter in Russia’s decades-long dominance over Europe’s energy markets. The termination of this deal comes amidst the ongoing war between Ukraine and Russia, with neither side willing to negotiate an extension. Europe is expected to rely heavily on liquefied natural gas (LNG) imports. Christoph Halser of Rystad Energy estimates that the EU will need to source approximately 7.2 billion cubic meters of gas from the global LNG market.
As Europe pivots away from Russian gas, the United States emerges as a key player in filling the supply gap. US LNG exports to Europe have already been rising in recent years, and this shift presents an even greater opportunity for American energy producers. With robust infrastructure and increased LNG export capacity, the U.S. is well-positioned to strengthen its role as a reliable supplier to Europe, enhancing energy security across the continent while bolstering its own energy industry.
The growth of US energy exports hinges on significant investments in infrastructure. According to a report by ICF, prepared for the American Petroleum Institute (API), the development of US oil and gas infrastructure is expected to remain robust through 2035. The report highlights that the primary drivers for continued infrastructure development remain strong. Shale and tight oil resource extraction are projected to continue at a rapid pace, supported by advancements in extraction technologies and favorable market responses to competitive commodity prices. Total capital expenditures (CAPEX) for oil and gas infrastructure are projected to range between $1.06 trillion and $1.34 trillion from 2017 to 2035. This equates to an average annual investment of $56 billion to $71 billion, spanning various infrastructure components, including surface and lease equipment, gathering and processing facilities, pipelines for oil, gas, and natural gas liquids (NGLs), storage facilities, refineries, and export terminals.
As global energy dynamics shift, the United States stands poised to play a pivotal role in ensuring energy security for Europe while driving growth in its own energy sector.
Why LandBridge Company LLC (LB) Is Skyrocketing
An aerial view of a well site, depicting the scale of oil and gas operations.
To compile our list of the 15 energy infrastructure stocks that are skyrocketing, we used Finviz and Yahoo stock screeners to rank the top 15 energy infrastructure stocks that achieved the highest gains over the past six months. We also included their hedge fund sentiment, which was taken from Insider Monkey’s Hedge Fund database of 900 elite hedge funds as of Q3 of 2024. The list is sorted in ascending order of 6-month performance, as of January 2.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Returns in Past 6 Months: 180.78%
Number of Hedge Fund Investors: 12
LandBridge Company LLC (NYSE:LB) is a leading land management company that operates in the Permian Basin, where it owns approximately 220,000 acres of land. The company’s primary business is to manage its land and resources to support oil and natural gas development in the United States. LandBridge Company LLC (NYSE:LB) generates revenue through royalties from oil and gas production on its land, sales of water for fracking, and payments for surface use of its land.
LandBridge Company LLC (NYSE:LB) is actively pursuing opportunities to develop data centers on its land, recognizing the significant growth potential of this emerging trend. The company’s strategic location in the Permian Basin provides a unique advantage, with access to low-cost power, water, and land making it an attractive location for data center operators. LandBridge Company LLC (NYSE:LB) has already seen significant success in this area, with a recent lease development agreement for a 2,000-acre site in Reeves County, Texas, which will be used to develop a one-gigawatt data center. This project is expected to generate significant revenue for the company. The stock performance of LandBridge Company LLC (NYSE:LB) has been exceptionally strong, driven by the company’s successful efforts to capitalize on the growing demand for data centers in the Permian Basin.
Looking ahead, LandBridge Company LLC (NYSE:LB) is well-positioned to continue to capitalize on the growing demand for data centers in the Permian Basin. As the demand for data storage and processing continues to grow, LandBridge Company LLC (NYSE:LB) is expected to play a significant role in supporting the development of new data centers in the region, driving long-term growth and value creation for shareholders.
Overall, LB ranks 2nd on our list of energy infrastructure stocks that are skyrocketing. While we acknowledge the potential of LB to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than LB but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
