Top Natural Gas Stocks for Q2 2022

Oct 24, 2023 By Triston Martin

Although natural gas is not a renewable fossil fuel, it is still very popular in the United States. It is also a major natural gas producer and has been subject to severe sanctions. Chesapeake Energy Corp. and Antero Resources Corp. are the major players. Benchmark exchange-traded funds (ETFs) that measure the price of natural gas have provided a trailing total return (one-year) of 73.6%. This is significantly higher than the Russell 1000's 8.2% one-year trailing total returns. All data and figures below were as of March 8, 2022. These are the three top natural gas stocks that have the highest value, fastest growth, and most momentum. These companies may not be pure-play natural gas companies as many focus on more than half of their production.


Price to sales metric measures growth during the most recently completed quarter. The natural gas sector has seen a turnaround after many years of struggle. We see positive earnings numbers when we look at growth in the latest quarter but not when we compare the earnings from the four previous quarters, which is what our value metrics show. This illustrates how changing the period you analyze a sector can dramatically change your assessment.


Best Value Natural Gas Stocks


These natural gas stocks have the lowest 12-month-to-date price-to-sales ratio (P/S). This can be used to measure a company's value for companies in their early stages of development or industries that have suffered major shocks. Higher sales can lead to higher profits when the business achieves profitability. The P/S ratio is the price you pay for a stock for every dollar of sales.


Southwestern Energy Co.


The company is an independent energy company that explores and produces natural gases, oil, and other related products, focusing on Ohio, West Virginia, Pennsylvania, and West Virginia. The company's fourth quarter ended December 31, 2021. The company posted a net income of $2.4billion compared to net losses in the previous-year quarter. Operating revenues also increased more than fourfold year-over-year (YOY). The positive $2.0 billion non-cash change in unsettled market derivatives had a negative impact on net income.


Chesapeake Energy Corp.


Chesapeake Energy, an independent exploration and production firm, is engaged in formulating, exploring, and developing properties that produce oil, natural gas, and related products. The company operates primarily in Louisiana and Texas. Chesapeake Energy announced on March 9 that it had acquired Chief E&D Holdings LP and the associated non-operated interests. The cash payment was $2.0 billion. Chief E&D Holdings has producing assets and an inventory of premium locations for drilling.



Fastest-Growing Natural Gas Stocks


These top natural gas stocks are ranked using a growth model. The success of a company depends on both sales and earnings. Ranking companies based on one growth metric is not fair. This makes it vulnerable to accounting anomalies in the quarter. These include changes in tax law and restructuring costs that could make one or both figures unrepresentative of the overall business. Outliers were those with quarterly revenue or EPS growth exceeding 2,500%.


Range Resources Corp.


An independent natural gas, natural gas liquids, and oil company. The company's primary focus is on the exploration and production of natural gas, crude oil, and other products. Net income rose 23-fold in Q4 2021 (ended Dec. 31), while revenue doubled YoY. Due to lower commodity prices, the quarterly results were boosted by a $310 Million mark-to-market derivative gain.


Coterra Energy Inc.


Coterra Energy Inc. was formerly Cabot Oil & Gas Corp., a diversified energy firm developing oil-and-gas properties. It is located in Texas, New Mexico, and other parts of the United States.


Antero Resources Corp.


Antero Resources, an oil and natural gas company, explores, develops, and acquires natural and liquid natural gas. It also owns oil properties. The company is based in West Virginia and Ohio. Antero announced Q4 2021 earnings results on February 16. The company's net income grew by almost 13 fold YOY due to increased net revenue. These numbers were affected by $182 million in expenses related to drilling and capital expenditures.



Natural Gas Stocks with the Most Momentum


They are natural gas-related stocks with the highest returns in the past twelve months. Companies with more than 2500% total returns were not considered outliers.


Vermilion Energy Inc.


A Canada-based energy producer that investigates the development develops, buys, and produces natural gas and crude oil properties. The company's operations are primarily focused in North America, Europe, and Australia.

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