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Dec
20
Ida Hansen
With Natural Gas Rising, Time to Buy Even More?
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A major factor for the appeal of long term investing is that it keeps individuals from selling too soon.

That is what investors who own shares in the natural gas industry must be wondering about now.  Natural gas prices are at a 2 and one-half year high. At the present, demand is up due to the cold weather in the United States and production is off due to equipment malfunctions, according to an article in The Wall Street Journal.  Not only that, the future for the industry is bullish too according to a recent report from the United States Department of Energy. Gas utilities stocks such as Sempra Energy (NYSE: SRE), Questar (NYSE: STR), and Clean Energy Fuels (NYSE: CLNE) should be solid buys for profiting from the sector for the long term.

It has been a good year for those stocks, as with so many others due to the bull market.

For 2013, Sempra Energy is up nearly 30% (chart below).  Over the same period, Questar has jumped almost 20%.  Clean Energy Fuels has done well in recent action, rising more than 4% for the last week of trading.

The dividend component adds to the total return for each company.

Sempra Energy has a dividend of 2.85%.  The average dividend for a member of the Standard & Poor’s 500 Index is around 1.9%.  For Questar, the dividend is 3.17%.

Even with the bull market for 2013, Wall Street is still very positive about the future ahead for these gas utilities.  Now trading around $22.70, the mean analyst target price over the next year for Questar Corporation is $25.00.  Sempra Energy is now around $88.30.  Over the next year the analyst community expects it to rise to $94.27.  For Clean Energy Fuels, now around $12.75, there is an expected rise in the share price to $12.75.

 



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