What is a drilling rig count and why does it matter?

A drilling rig count is a tally of the number of active drilling rigs in a region or country. It's considered an important indicator of future oil and natural gas production. When companies deploy more rigs, it suggests they're investing in new wells that will eventually produce more natural gas. For investors, rising rig counts often signal growing confidence in the market, potential price stability, and increased business activity throughout the energy sector.

What's the difference between upstream, midstream, and downstream in natural gas?

The natural gas industry is divided into three main segments: Upstream companies focus on finding and producing natural gas (exploration and drilling). Midstream businesses handle the transportation, storage, and processing of natural gas through pipelines and facilities. Downstream operations involve delivering natural gas to end-users and converting it to usable products. This stock group includes companies from both upstream (like EQT and RRC) and midstream (like WMB and OKE) segments to provide comprehensive exposure to the natural gas value chain.

What is the Haynesville Shale mentioned in this theme?

The Haynesville Shale is a major natural gas field located in East Texas, Northwest Louisiana, and Southwest Arkansas. It's one of the largest and most productive natural gas reservoirs in the United States. The region is known for its high-quality natural gas reserves and proximity to export facilities along the Gulf Coast. Companies with significant operations in the Haynesville Shale may benefit from the area's productive geology and strategic location, especially as natural gas drilling activity increases.

What does "Dividend Yield" mean in the stock data?

Dividend yield represents the annual dividend payment as a percentage of the stock's current price. For example, if a $100 stock pays $3 in annual dividends, its dividend yield is 3%. Many natural gas companies, especially midstream operators like WMB and OKE, are known for paying dividends to shareholders. A higher yield may look attractive, but it's important to consider whether the dividend is sustainable based on the company's earnings and cash flow. Dividend yield is just one factor to consider when evaluating these energy stocks.

What does "Projected Sales" and "Projected Profit" tell me about these companies?

"Projected Sales" refers to analysts' forecasts of a company's future revenue, while "Projected Profit" indicates expected earnings. These forward-looking metrics can help you understand how a company might perform in the coming periods. For natural gas companies, increased drilling activity today could lead to higher projected sales and profits in the future as new wells come online. These projections are especially useful when evaluating whether a company is likely to benefit from the current upturn in natural gas drilling activity.

16 handpicked stocks

Natural Gas Drilling Revival Play

A carefully selected group of stocks poised to benefit from the recent upturn in U.S. natural gas drilling activity. Our professional analysts have identified companies across the entire natural gas value chain that could see improved performance as drilling rebounds for the first time in twelve weeks.

Han Tan | Market Analyst

Published on July 20

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

EQT Corporation

EQT

Current price

$55.76

Cheniere Energy, Inc.

LNG

Current price

$231.79

Range Resources Corporation

RRC

Current price

$38.57

Ovintiv Inc

OVV

Current price

$39.56

EOG Resources, Inc.

EOG

Current price

$110.40

Williams Companies, Inc.

WMB

Current price

$64.06

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12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

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In 12 months it might be worth:

$1,000.00

+42.47%

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About This Group of Stocks

Our Expert Thinking

This collection targets companies benefiting from renewed natural gas drilling, with rig counts at their highest since March 2024. The increase signals a potential bottom in the drilling downturn and shifting capital allocation toward natural gas assets, creating opportunities across the entire value chain.

What You Need to Know

Drilling activity serves as a leading indicator of future production. This theme offers exposure to companies that may see improved utilization rates, pricing power, and cash flow generation as activity levels normalize after twelve weeks of decline.

Why These Stocks

These companies were specifically chosen to capture different segments of the natural gas industry: exploration and production companies with key basin assets, service providers offering essential drilling capabilities, and midstream operators that handle transportation infrastructure.

Group Performance Snapshot

42.47%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 42.47% over the next year.

11 of 16

Stocks Rated Buy by Analysts

11 of 16 assets in this group are rated Buy by professional analysts.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

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Riding the Reversal Wave

After twelve straight weeks of declining rig counts, the natural gas sector is showing signs of a comeback. This could be your chance to get in at what might be the bottom of the cycle.

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Early Indicator Advantage

Drilling activity is a leading indicator of future energy production. By investing now, you could position yourself ahead of broader market recognition of this trend shift.

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Full Value Chain Exposure

This collection offers exposure to every segment of the natural gas industry, from exploration companies finding the gas to midstream operators moving it to market. It's comprehensive coverage in a single investment theme.

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