Profit from surging natural gas prices

Article Excerpt

Natural gas prices have finally rebounded after almost three years of depressed prices. In those years, warm winters cut into gas used for heating, and that’s a major part of total gas use. As a result, gas in storage grew and prices stagnated. A glut of shale gas due to improved drilling technology also held prices down. But record low temperatures are now spiking demand, and gas prices have jumped. Here are two stocks that will gain from those higher prices. ENCANA CORP. $20.83 (Toronto symbol ECA; Shares outstanding: 740.2 million; Market cap: $15.1 billion; TSINetwork Rating: Average; Dividend yield: 1.4%; www.encana.com) is one of North America’s largest natural gas producers. In the three months ended September 30, 2013, Encana’s cash flow per share fell 28.2%, to $0.89 from $1.24 a year earlier (all amounts except share price and market cap in U.S. dollars). The decline mostly came from lower realized gas prices. Encana now plans to cut its dependence…