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CONSOL Energy Scales 52-Week High on Shift to Natural Gas

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Shares of CONSOL Energy Inc. (CNX - Free Report) scaled a new 52-week high of $19.76 in Wednesday’s trading session before closing at $18.62. The stock has delivered a one-year return of about 39.5%.

Over the past 52 weeks, CONSOL Energy’s shares have ranged from a low of $4.54 on Jan 20, 2016 to a high of $19.76 on Sep 7, 2016. The average volume of shares traded over the last three months is approximately 4.4 million.

What’s Driving the Stock?

CONSOL Energy has shifted its focus to the production of natural gas. Keeping with this, the company continues to acquire acreage in regions that may have a large volume of natural gas reserve. However, the company has lowered its E&P capital budget guidance for 2016 by 25% to the range of $195 million to $205 million from its earlier projection of $205 million to $325 million. On the other hand, 2016 E&P division production guidance has been raised to the 380–385 billion cubic feet equivalent (“Bcfe”) band from the prior expectation of 378 Bcfe.

CONSOL Energy is presently focusing on the Marcellus and Utica plays. The company currently controls 436 thousand net acres in the Marcellus Shale and approximately 622 thousand net acres in the Utica Shale. In the second quarter of 2016, production volumes and operating costs in both these shales fell from the year-ago levels. CONSOL Energy’s focus on these two plays will drive production and help the company achieve its new production goals.

CONSOL ENERGY Price and Consensus

CONSOL ENERGY Price and Consensus | CONSOL ENERGY Quote

CONSOL Energy’s cost savings initiatives have also been helping the company survive in this difficult commodity price environment. Over the last 24 months, the E&P unit’s cash costs have improved over 30%, lending support to its margins.

Zacks Rank and Key Picks

CONSOL Energy carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the same space include Alliance Holdings GP, L.P. , Cloud Peak Energy Inc. and Hallador Energy Company , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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