Harbour Energy: A Double Digit Dividend Yield From European Natural Gas

2025-05-16 10:30:00 ET

Summary

• I'm bullish on Harbour Energy due to its strong exposure to high European natural gas prices and operational efficiency post-acquisition.
• The company’s reduced unit costs, robust hedging, and tightened guidance support healthy margins and improved cash flow outlook.
• Harbour’s generous 11% dividend yield, solid balance sheet, and investment-grade ratings make it an attractive income play.
• I see further upside if Harbour exits UK operations and reallocates capital to regions with more favorable tax regimes.

Introduction

As I have been increasing my position in Harbour Energy ( PMOIF ) in the past few months, I’m planning to keep close tabs on the company’s performance given the current volatility on the oil and gas markets. I mainly like Harbour’s exposure to European natural gas prices which currently trade at approximately 35 EUR per MWh (which is more than three times higher than the current Henry Hub natural gas price). ...

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