For those who are bullish on natural gas, there is Southwestern Energy Co. (NYSE: SWN).
Based in Houston, Southwestern Energy Co. has been expanding in presence in natural gas, especially in the Fayetteville Shale in Arkansas and the Marcellus Shale in Pennsylvania.
This comes at a time when others such as BHP Billiton (NYSE: BHP), the world’s largest natural resources company is selling. But Steven Mueller, the Chief Executive Officer of Southwestern Energy, is very bullish on natural gas. This sentiment is not presently shared by Wall Street.
United States Natural Gas (NYSE: UNG), the exchange traded fund for natural gas, is down for the last week, month, quarter, six months, and year of market action.
That is much the same story for Southwestern Energy: it too is off for the last week, month, quarter, six months, and year of trading. For 2014. Southwestern Energy has fallen by over 27.6 percent (chart below). To state that the market conditions for natural gas are bearish is an understatement.
Which means it could be the best time to buy Southwestern Energy for the long term.
For that, one would have to be bullish about the future of natural gas. Steve Mueller certainly is: he has Southwestern Energy buying when others are selling. That could turn out to be a tremendous strategy if the price of natural gas rebounds. The usage is projected to increase by reports from virtually all organization, both government and private.
That should send the price higher.
If that happens, then Mueller and the shareholders of Southwestern Energy will benefit by his vision’ and taking action when others were selling. Mueller has also lowered the cost of drilling of operations for Southwestern Energy. From that, earnings should improve tremendously if the price of natural gas increases. The mean analyst target price for Southwestern Energy is now $40 with the share price around $28.50.