CNX - A Focus On Free Cash Flow Sets CNX Resources Apart In The Energy Sector

2024-04-29 09:55:05 ET

Summary

• CNX Resources has a unique strategy that focuses on free cash flow, using it for share buybacks and debt reduction.
• The company has delivered strong returns on common equity and its share price has risen robustly over the past one and five years.
• Expect a modest price increase in the next 12 months based on CNX's medium-term plans for flat production, operational efficiency, and reducing the share count.

Thesis

CNX Resources Corporation ( CNX ) has a unique strategy, one that emphasizes free cash flow, or FCF. The natural gas producer then allocates much of that FCF to share buybacks and reducing its debt.

It’s been a successful strategy, one that has produced Energy sector-leading returns on equity, total capital, and assets, as well as a one-year share price gain of just over 47%....

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