Morgan Stanley has moved to a more bullish stance on U.S. liquefied natural gas (LNG) exporters, upgrading both Venture Global and Cheniere Energy to Overweight as a result of recent supply disruptions in the Middle East that tightened near- and medium-term gas balances.
The bank upgraded its view of the broader LNG sector to In-Line from Cautious, saying that damage to Qatar’s Ras Laffan complex combined with project delays has created a material supply shortfall this year. Morgan Stanley added that these disruptions are likely to have effects stretching into multiple years, and that the change in the supply outlook reduces the previously anticipated risk of oversupply in 2027-2028.
Morgan Stanley highlighted the immediate market consequence as a need to rebuild inventories to replace lost cargoes, a dynamic that increases the probability of higher gas prices.
Venture Global
The bank sees the greatest upside potential at Venture Global because of its larger exposure to spot LNG pricing. Morgan Stanley noted that roughly 30% of Venture Global’s 2026 cargoes are uncontracted, rising to about 40% across 2026-2029. The research team estimated that each $1 per mmbtu increase in margins could add roughly $600 million to 2026 EBITDA, equivalent to about a 10% increase.
Higher forward prices have already prompted Morgan Stanley to roughly double its 2026 EBITDA forecast for Venture Global compared with its prior estimate. The bank raised its price target on the company to $22 from $8 and moved the rating up from Underweight to Overweight.
Cheniere Energy
By contrast, Morgan Stanley described Cheniere’s earnings sensitivity to recent price increases as more constrained because of its mostly contracted portfolio, which provides stable cash flows. The bank estimated that recent price gains translate to an approximate 7% increase in Cheniere’s 2026 EBITDA forecast.
With a brighter market backdrop, Morgan Stanley raised the probability of new project approvals within the next one to two years and now incorporates additional expansion at Sabine Pass and Corpus Christi into its valuation. The firm lifted its price target on Cheniere to $313 from $236 and upgraded the stock from Equal-weight to Overweight.
Separately, Morgan Stanley increased its price target on Cheniere Energy Partners to $72 from $55 while keeping an Equal-weight rating on that security.
ProPicks AI note
The report also referenced ProPicks AI, noting that the tool evaluates LNG alongside thousands of other companies each month using over 100 financial metrics. The AI-based strategy claims to assess fundamentals, momentum and valuation without bias and cited past winners including Super Micro Computer (+185%) and AppLovin (+157%).
Overall, Morgan Stanley’s revisions reflect a reassessment of near- and medium-term supply risk following the disruptions in the Middle East, a reassessment that favors companies with greater exposure to spot pricing while still recognizing the relative stability of contracted portfolios.