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The Zacks Analyst Blog Highlights: Gulfport, Chesapeake, Southwestern Energy, SilverBow and Antero
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For Immediate Release
Chicago, IL –April 16, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Gulfport Energy Corp. (GPOR - Free Report) , Chesapeake Energy Corp. (CHK - Free Report) , Southwestern Energy Company (SWN - Free Report) , SilverBow Resources, Inc. (SBOW - Free Report) and Antero Resources (AR - Free Report) .
Here are highlights from Monday’s Analyst Blog:
EIA Data Shows U.S. Natural Gas Supplies Rising
The U.S. Energy Department's weekly inventory release showed a smaller-than-expected increase in natural gas supplies. However, the injection was higher than the five-year average.
Analysis Less-than-Expected Rise in Storage
Stockpiles held in underground storage in the lower 48 states rose by 25 billion cubic feet (Bcf) for the week ended Apr 5, below the guidance (of 33 Bcf gain) as per the analysts surveyed by S&P Global Platts. However, the increase was higher than the five-year (2014-2018) average net injection of 5 Bcf, while the reported week saw a drop of 20 Bcf last year.
Despite past week’s supply addition, at 1.155 trillion cubic feet (Tcf), natural gas inventories are 485 Bcf (29.6%) under the five-year average and 183 Bcf (13.7%) below the year-ago figure.
Fundamentally speaking, total supply of natural gas averaged around 93.9 Bcf per day, down 0.9% on a weekly basis as dry production fell. Meanwhile, daily consumption fell 9.3% to 76.5 Bcf primarily due to weaker residential/commercial demand.
Natural Gas Futures Struggle to Break Above $3
While natural gas futures have edged up a bit from the recent low of $2.543 per MMBtu in early February and currently trade around $2.7 per MMBtu, it’s still 44% below the four-year high of $4.929 per MMBtu reached in mid-November. The early onset of winter, together with the lowest level of stocks in 15 years, demand from power plants and growing LNG shipments lifted the commodity to almost $5 per MMBtu.
But the euphoria didn’t last long, as mild weather in December and early January led to smaller withdrawals that markedly reduced the storage deficit and sent prices lower.
What Is the Future of Natural Gas Prices?
The fundamentals of natural gas consumption continue to be favorable. The demand for cleaner fuels and the commodity’s relatively lower price has catapulted natural gas' share of domestic electricity generation to 35%, from 25% in 2011. Moreover, new pipelines to Mexico, together with large-scale liquefied gas export facilities have meant that exports out of the U.S. are set for a quantum leap. Finally, higher consumption from industrial projects will likely ensure strong natural gas demand.
However, record high production in the United States and expectations for explosive growth through 2020 means that supply will keep pace with demand. Therefore, prices are likely to trade sideways but for weather-driven movements. Also, with the traditional withdrawal season (when supplies fall on heating demand due to cold weather) having ended in March, consumption is likely to decline in the near term.
Want to Own a Natural Gas Stock Now?
The uncertain natural gas fundamentals (considering its seasonal nature) is responsible for the understandable reluctance on investors’ part to dip their feet into these stocks.
Moreover, most natural gas-heavy upstream companies like Gulfport Energy Corp., Chesapeake Energy Corp., Southwestern Energy Company, etc. carry a Zacks Rank #3 (Hold), which means that investors should preferably wait for a better entry point before buying shares in them. Some like SilverBow Resources, Inc are further down the pecking order, with Zacks Rank #5 (Strong Sell).
If you are looking for near-term natural gas play, Antero Resources might be an excellent selection. The companies have a Zacks Rank #1 (Strong Buy).
This Denver, CO-headquartered company’s expected EPS growth rate for three to five years currently stands at 20%, comparing favorably with the industry's growth rate of 19.1%.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Gulfport, Chesapeake, Southwestern Energy, SilverBow and Antero
For Immediate Release
Chicago, IL –April 16, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Gulfport Energy Corp. (GPOR - Free Report) , Chesapeake Energy Corp. (CHK - Free Report) , Southwestern Energy Company (SWN - Free Report) , SilverBow Resources, Inc. (SBOW - Free Report) and Antero Resources (AR - Free Report) .
Here are highlights from Monday’s Analyst Blog:
EIA Data Shows U.S. Natural Gas Supplies Rising
The U.S. Energy Department's weekly inventory release showed a smaller-than-expected increase in natural gas supplies. However, the injection was higher than the five-year average.
Analysis Less-than-Expected Rise in Storage
Stockpiles held in underground storage in the lower 48 states rose by 25 billion cubic feet (Bcf) for the week ended Apr 5, below the guidance (of 33 Bcf gain) as per the analysts surveyed by S&P Global Platts. However, the increase was higher than the five-year (2014-2018) average net injection of 5 Bcf, while the reported week saw a drop of 20 Bcf last year.
Despite past week’s supply addition, at 1.155 trillion cubic feet (Tcf), natural gas inventories are 485 Bcf (29.6%) under the five-year average and 183 Bcf (13.7%) below the year-ago figure.
Fundamentally speaking, total supply of natural gas averaged around 93.9 Bcf per day, down 0.9% on a weekly basis as dry production fell. Meanwhile, daily consumption fell 9.3% to 76.5 Bcf primarily due to weaker residential/commercial demand.
Natural Gas Futures Struggle to Break Above $3
While natural gas futures have edged up a bit from the recent low of $2.543 per MMBtu in early February and currently trade around $2.7 per MMBtu, it’s still 44% below the four-year high of $4.929 per MMBtu reached in mid-November. The early onset of winter, together with the lowest level of stocks in 15 years, demand from power plants and growing LNG shipments lifted the commodity to almost $5 per MMBtu.
But the euphoria didn’t last long, as mild weather in December and early January led to smaller withdrawals that markedly reduced the storage deficit and sent prices lower.
What Is the Future of Natural Gas Prices?
The fundamentals of natural gas consumption continue to be favorable. The demand for cleaner fuels and the commodity’s relatively lower price has catapulted natural gas' share of domestic electricity generation to 35%, from 25% in 2011. Moreover, new pipelines to Mexico, together with large-scale liquefied gas export facilities have meant that exports out of the U.S. are set for a quantum leap. Finally, higher consumption from industrial projects will likely ensure strong natural gas demand.
However, record high production in the United States and expectations for explosive growth through 2020 means that supply will keep pace with demand. Therefore, prices are likely to trade sideways but for weather-driven movements. Also, with the traditional withdrawal season (when supplies fall on heating demand due to cold weather) having ended in March, consumption is likely to decline in the near term.
Want to Own a Natural Gas Stock Now?
The uncertain natural gas fundamentals (considering its seasonal nature) is responsible for the understandable reluctance on investors’ part to dip their feet into these stocks.
Moreover, most natural gas-heavy upstream companies like Gulfport Energy Corp., Chesapeake Energy Corp., Southwestern Energy Company, etc. carry a Zacks Rank #3 (Hold), which means that investors should preferably wait for a better entry point before buying shares in them. Some like SilverBow Resources, Inc are further down the pecking order, with Zacks Rank #5 (Strong Sell).
If you are looking for near-term natural gas play, Antero Resources might be an excellent selection. The companies have a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
This Denver, CO-headquartered company’s expected EPS growth rate for three to five years currently stands at 20%, comparing favorably with the industry's growth rate of 19.1%.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.
See 7 breakthrough stocks now>>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.