Two producers ready for a gas boom

Article Excerpt

The price of natural gas has more than doubled in the past year, but prices of natural gas stocks have not kept pace. Maybe that’s because investors take it for granted that winters will remain warm due to global warming. But if that’s how things turn out, rising temperatures will increase demand for air conditioning, which of course runs on electricity. As well, natural gas may be dirtier than wind and solar, but it offsets coal use, mainly in electricity generation. That could lower the influence of environmentalists, who mostly oppose projects that would help build natural gas exports. At current prices, many natural gas stocks offer attractive yields. Eventually, these stocks are likely to boom. Here are two we recommend: PEYTO EXPLORATION & DEVELOPMENT CORP. $28.80 (Toronto symbol PEY; Shares outstanding: 148.5 million; Market cap: $4.3 billion; TSINetwork Rating: Extra Risk; Dividend yield: 2.5%; www.peyto.com) produces and explores for oil and natural gas in Alberta. Its average daily production…