Analysts continues to recommend OGZPY on valuation.
Meter Reader
A Weekly Analysis of Energy Stocks Using the McDep Ratio
April 22, 2008
Sold Out
Summary and Recommendation
mcdep.com
From the article:"...As natural gas seems to be reaching its current supply limits globally, the outlook appears encouraging for further gains in stock price for buy-recommended natural gas producers including the world’s largest, Gazprom (OGZPY). China apparently outbid Europe and the U.S. for the last uncommitted volumes from Qatar, the world’s leading producer of liquefied natural gas (LNG). Qatari Energy Minister Abdullah bin Hamad al-Attiyah says “We are not in the charity business. Whoever will give me the best price, I will follow him.” Quoted by Bloomberg, the minister adds with finality, “We are sold out.” Because it can be transported anywhere, LNG is the chain that links global markets for natural gas to an oil-equivalent price. Anecdotally, the price of incremental natural gas supply in Asia may be approaching $20 a million btu. Near-month futures quotes are about $12.40 at the National Balancing Point in the U.K. and about $10.60 at the Louisiana Henry Hub in the U.S. Since futures have been publicly quoted for six years ahead, natural gas is at an all-time low relative to oil (see chart Oil/Natural Gas Futures Ratio). The stage is set for a quick doubling of long-term natural gas price that would have positive profit implications for producers anywhere in the world...."
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Based on the McDep Ratio valuation, COP is a slightly better value at .74 vs .78.. However OGZPY has 5x's the NG reserves than COP.
EKS |
