Carl Icahn Says Buy Chesapeake Energy Before Natural Gas Prices Soar ($CHK, $RRC)
Our readers have long known our bullish stance on oil but we have not discussed much about what we think natural gas is capable of. Due to the introduction of hydraulic fracturing and horizontal drilling, companies in the U.S. were able to extract gas from these shale formations at lower costs, increasing their profitability as well as the supply of natural gas available in the domestic market.
The increased supply of natural gas in the domestic market has decreased the fuel’s price by more than 40% in the past one year.
The question is it time to buy natural gas stocks again? We recommend you consider 2, $CHK and $RRC.
Carl Icahn tells CNBC that natural gas prices will rebound, and Chesapeake (CHK+1.1%) is poised to benefit: “Aubrey [McClendon] is a very bright guy and he’s put a lot of great assets together… Now they have to cut expenses, but I think they can.” On CHK’s board shakeup, which he helped to instigate: ”The shareholders control the company now.” Source
Natural gas should continue to rebound with a hot summer. Range Resources has provided investors with phenomenal returns. Management is focused upon per share growth of production and reserves at a low cost basis. Range’s 2012 organic growth rate should be 30% versus a historical 10% growth rate. Management keeps a simple and understandable financial capital structure. Range controls top tier assets throughout the premiere oil and natural gas fields. Buy this stock and hold on for continued success. Source
Post your favorite natural gas stocks below and watch for new natural gas stocks in upcoming articles.
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