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

Updated 2 days ago | Published at जुलाई 20