US Natural Gas Bounces Back On Summer Heatwave: 5 Undervalued Natural Gas Stocks To Keep On Your Radar

Natural gas Henry Hub futures experienced a 3% increase on Monday, bouncing back from a four-day losing streak. The rise in natural gas is attributed to expectations of above-average temperatures this month, leading to increased demand for air conditioning.

The National Weather Service’s long-term forecasts indicate hot weather ahead, with the eight to 14-day outlook projecting hotter-than-average temperatures in most areas except the Pacific Northwest.

“Heat will continue early this week across much of the Southern Tier, including the Southwest, Texas, and the Florida Peninsula. The oppressive heat in combination with high humidity may allow heat indices to exceed 100F across portions of the central Plains, with 110F+ heat indices degrees throughout portions of South Texas and the Desert Southwest throughout the early week. Dangerous conditions are possible if citizens are unable to find relief in air-conditioned buildings,” the National Weather Service wrote on Monday.

U.S. natural gas prices have risen approximately 25% since early June, reaching $2.65 per million British thermal units.

Chart: US Natural Gas Prices Have Been On The Rise

5 Natural Gas Stocks To Monitor

Cheniere Energy, Inc. LNG

Description: Cheniere Energy is a leading producer of liquefied natural gas (LNG) in the United States, operating several LNG terminals and export facilities.
Market cap: $37 billion
Total return (one month): 5%
Total return (year to date): 2.1%
Forward P/E (next twelve months): 13x
Revenues growth (past 5 years annualized): 37.7%
Median analyst target vs. current market price: 27.5% higher

Oneok, Inc. OKE

Description: Oneok is a midstream energy company that specializes in the gathering, processing, storage, and transportation of natural gas and natural gas liquids (NGLs).
Market cap: $28 billion
Total return (one month): 3.3%
Total return (year to date): down by 2.2%
Forward P/E (next twelve months): 14.4x
Revenues growth (past 5 years annualized): 11.4%
Median analyst target vs. current market price: 14.2% higher

Kinder Morgan, Inc. KMI

Description: Kinder Morgan is one of the largest energy infrastructure companies in North America, engaged in the transportation and storage of natural gas, crude oil, and petroleum products.
Market cap: $38.03 billion
Total return (one month): down by 1.5%
Total return (year to date): down by 3.1%
Forward P/E (next twelve months): 15.1x
Revenues growth (past 5 years annualized): 6.5%
Median analyst target vs. current market price: 18.2% higher

Antero Resources Corp. AR

Description: Antero Resources is an independent exploration and production company focused on natural gas and liquids-rich hydrocarbons, with significant operations in the Appalachian Basin.
Market cap: $6.8bn
Total return (one month): 2.3%
Total return (year to date): down by 27%
Forward P/E (next twelve months): 17x
Revenues growth (past 5 years annualized): 21%
Median analyst target vs. current market price: 22.5% higher

EQT Corporation EQT

Description: EQT Corporation is a leading natural gas producer in the Appalachian Basin, with a focus on developing and producing natural gas from unconventional shale formations.
Market cap: $14.47 billion
Total return (one month): 3.3%
Total return (year to date): 19.6%
Forward P/E (next twelve months): 18.5x
Revenues growth (past 5 years annualized): 29%
Median analyst target vs. current market price: 12% higher