Today shares of Liquefied Natural Gas Ltd (ASX: LNG) (LNGL) climbed a whopping 35 cents, or 13.94%, to close at $2.86.
The rapid ascent comes despite a week of sensational volatility in oil and gas stocks and follows OPEC's decision to refrain from cutting oil production in the face of prolonged oversupply.
Last week's decision sent the commodity's price into a downward spiral. On Monday, LNGL's share price fell 25% whilst fellow ASX-listed resources stocks Woodside Petroleum Limited (ASX: WPL), Oil Search Limited (ASX: OSH) and Santos Ltd (ASX: STO) also got hit hard.
However, despite today's price jump, LNGL shares are currently down 20% over the past month.
Should you buy?
Since February this year when I first wrote about – and bought shares of – LNGL its market price has gained a whopping 1,200% and despite a recent setback the shares are still 800% higher than when I bought in. Whilst at today's prices it's certainly not the bargain it was at $0.30, LNGL still has a lot of potential.
For example, if it can get even one of its two North American LNG tolling facilities built and into production as planned, its shares will be worth a lot more than they are today.
However since it's not yet profitable (it fact, profitability is still years away), investors would be wise to consider the risks, maintain a diversified portfolio and keep speculative punts to a minimum.
Could these 3 resources stocks be the next LNGL?
