In This Article:
Key Takeaways
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Cold weather should benefit natural gas producers Range Resources, Antero Resources, and Comstock Resources.
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U.S. Energy Information Administration predicts a colder winter across much of the US compared to last year.
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As winter approaches with colder temperatures expected, energy investors increasingly focus on natural gas, a cleaner-burning alternative to oil and coal, due to rising heating demand. As a result, Range Resources Corporation RRC, Antero Resources Corporation AR, and Comstock Resources Inc. CRK are well-positioned to benefit.
Colder Winter Forecast Across the U.S. Drives Gas Demand
In its short-term energy outlook, the U.S. Energy Information Administration forecasts a colder winter across much of the United States compared with last year's mild season. This cooler weather is expected to increase demand for natural gas to meet heating needs, thereby driving natural gas prices upward. Currently, the commodity's price is trading at $2.847 per MMBtu, suggesting an improvement of more than 14% in a month.
The higher price of natural gas is beneficial for companies like Range Resources, Antero Resources and Comstock Resources that are engaged in the exploration and production of the commodity. All the stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Natural Gas Explorer to Gain: RRC, AR, CRK
Range Resources
Range Resources is among the leading natural gas producers in the United States. The upstream energy player has a strong footprint in the prolific Appalachian basin, with a huge inventory of premium drilling sites securing future production outlook. RRC has a resilient balance sheet it can rely on when the business environment turns unfavorable.
Antero Resources
Antero Resources is among the top five natural gas companies in the United States and is a pure-play Appalachian producer. The company has a solid production outlook with a huge inventory of drilling sites. AR can sail through unfavorable business scenarios as it has an investment-grade credit rating.
Comstock Resources
Comstock Resources is also a well-known producer of natural gas with its operations spread across the prolific Haynesville Shale in North Louisiana and East Texas. Comstock’s strategy to expand its Western Haynesville acreage, now exceeding 450,000 net acres, shows significant potential, particularly with the recent advancements in drilling techniques.