FANG - Who Could Be The Unhedged NatGas Winners? Let The Data Talk
- After underperforming for a very long time, natural gas prices have outpaced crude oil and liquids so far this year.
- Logically, gas-focused upstream producers should benefit but unfortunately most companies are hedged.
- I apply a top-down data-based approach focused on the gas exposure and hedging positions for 33 independent upstream producers.
- I then examine the correlation between the proportion of unhedged gas in these companies' portfolios and their recent stock price appreciation to identify any potential mispricing.
- I identify a couple of potentially still undervalued prospects that are relatively unhedged.
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Who Could Be The Unhedged NatGas Winners? Let The Data Talk