In this article, we will discuss 10 Most Profitable Natural Gas Stocks to Buy Now.
Natural gas rarely gets the same attention as high-growth tech or flashy AI names, but follow where serious money is going, and a different picture starts to emerge. Despite the ongoing energy transition, many of the world’s most sophisticated investors continue to lean heavily into traditional energy, particularly natural gas. The reason is simple: while narratives shift, cash flow, scale, and reliability still drive returns.
Hedge fund positioning offers a clear signal. Firms led by investors like Ken Griffin, Ray Dalio, and Paul Tudor Jones have consistently maintained meaningful exposure to oil and gas, treating the sector not as obsolete, but as a proven, cash-generating cornerstone of global markets. Even as renewables grow, fossil fuels continue to dominate energy allocations, reflecting a core belief: the transition will take time, and in the meantime, traditional energy remains highly profitable.
Within that framework, natural gas occupies a uniquely strategic position. Often described as a “bridge fuel,” it sits between legacy fossil fuels and cleaner energy sources— offering lower emissions than coal while providing the reliability that intermittent renewables cannot. This is why many institutional investors view natural gas not as a declining industry, but as a critical enabler of the energy transition. The long-term demand drivers are already in place: rising global energy consumption, accelerating LNG exports, and surging electricity needs from AI infrastructure and data centers.
At the same time, natural gas is not a straightforward buy-and-hold story. It is a deeply cyclical market, where timing matters. Hedge funds tend to rotate aggressively—leaning in when supply tightens and stepping back when oversupply pressures prices. This dynamic creates volatility, but also opportunity. For investors who understand the cycle, natural gas can be one of the fastest-moving segments of the energy market.
That’s where selectivity becomes critical. Rather than betting directly on commodity prices, experienced investors typically focus on high-quality companies across the value chain, from upstream producers to midstream infrastructure players. In particular, large-cap natural gas companies with strong margins stand out. Businesses generating 20%+ operating and net margins are often built on premium assets, efficient cost structures, and long-term contracts, allowing them to produce consistent free cash flow even in fluctuating environments.
This combination of scale, profitability, and structural demand is what makes certain natural gas stocks especially compelling today. They offer exposure to a multi-decade energy theme, while still benefiting from cyclical upside and strong capital return potential. In a market where many growth opportunities are already crowded and expensive, natural gas remains one of the few areas where investors can still find durable demand, real cash flow, and mispriced upside.
In this article, we take a closer look at natural gas stocks with market capitalizations above $2 billion and profit margins exceeding 20% and, more importantly, identify which ones may actually be worth owning right now.
Our Methodology
We used screeners to identify natural gas stocks with market capitalizations exceeding $2 billion that reported operating and net profit margins exceeding 20%. From this pool, we shortlisted the top 10 stocks with the highest trailing twelve-month (TTM) net income and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds. To make the list easier to navigate, we ranked the finalized stocks in ascending order by net profit margin.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
10 Most Profitable Natural Gas Stocks to Buy Now
10. Range Resources Corporation (NYSE:RRC)
Net Profit Margin: 21.94%
Operating Margin: 27.92%
On April 5, Jefferies raised its price target on Range Resources Corporation (NYSE:RRC) to $42 from $39 while maintaining a Hold rating, reflecting updated mark-to-market estimates amid improving commodity pricing. The revision underscores the strengthening macro backdrop for natural gas producers, as tighter supply conditions and rising demand continue to support higher realized prices and improved earnings visibility.
On April 3, Freedom Broker initiated coverage on Range Resources Corporation (NYSE:RRC) with a Hold rating and a $48 price target, expressing a constructive long-term view on the company’s positioning. The firm highlighted Range’s capital-efficient production growth and leverage to a structurally improving U.S. natural gas market, though it noted that much of this optimism may already be reflected in current valuations. Nonetheless, the company’s disciplined operating approach and focus on high-return assets provide a solid foundation for sustained performance.
Range Resources Corporation (NYSE:RRC) is a pioneer of the Marcellus Shale and a leading U.S. natural gas producer, with operations concentrated in the Appalachian Basin. Headquartered in Texas, the company has streamlined its portfolio to focus on high-quality, low-cost assets. With strong margins and exposure to rising natural gas demand—particularly from LNG exports and AI-powered infrastructure—Range Resources remains well-positioned to deliver steady cash flows, supporting a resilient investment profile with long-term upside potential.
9. Coterra Energy Inc. (NYSE:CTRA)
Net Profit Margin: 23.53%
Operating Margin: 28.75%
On March 30, Citi raised its price target on Coterra Energy Inc. (NYSE:CTRA) to $42 from $32 while maintaining a Buy rating, reflecting a more constructive outlook on commodity prices. The firm updated its models to incorporate higher oil price assumptions, signaling improved revenue and cash flow potential for upstream producers. For Coterra, which maintains a disciplined capital allocation framework, this environment enhances free cash flow generation and strengthens its ability to return capital to shareholders.
On March 27, Morgan Stanley raised its price target on Coterra Energy Inc. (NYSE:CTRA) to $42 from $28 while maintaining an Equal Weight rating, citing a structural shift in global energy markets. The firm noted that oil, LNG, and refining margins have reached multi-year highs, prompting a significant upward revision in long-term pricing assumptions. With EBITDA estimates across the sector rising materially, Coterra stands to benefit from both improved pricing and operational leverage, positioning it favorably within the exploration and production landscape.
Coterra Energy Inc. (NYSE:CTRA) is an independent oil and gas company formed through the merger of Cabot Oil & Gas and Cimarex Energy, hence combining strong positions in both natural gas and oil-rich basins. Headquartered in Houston, the company leverages a diversified asset base and disciplined capital strategy to generate consistent returns. As energy markets tighten and AI-driven industrial demand accelerates, Coterra’s high-margin operations and balanced portfolio make it a compelling investment opportunity.
8. South Bow Corporation (NYSE:SOBO)
Net Profit Margin: 23.95%
Operating Margin: 30.35%
On April 1, Morgan Stanley raised its price target on South Bow Corporation (NYSE:SOBO) to C$39 from C$35 while maintaining an Underweight rating, noting that investors are increasingly reassessing valuation frameworks across the midstream energy space. As macro uncertainty tied to geopolitical tensions continues to reshape capital allocation, the firm highlighted that market participants are beginning to recalibrate expectations for midstream earnings revisions, potentially creating valuation dislocations. With operating margins of 30.35% and net profit margins approaching 24%, South Bow stands out as a high-margin infrastructure asset, reinforcing its resilience even in volatile energy markets.
On March 18, TD Securities raised its price target on South Bow Corporation (NYSE:SOBO) to C$42 from C$40 while maintaining a Hold rating, reflecting updates to its Prairie Connector project assumptions. While the project remains in its early stages and faces execution-related challenges, it represents a long-duration growth catalyst tied to North American energy infrastructure expansion. As demand for secure crude transportation networks rises—particularly in a geopolitically fragmented world—projects like Prairie Connector could become increasingly strategic.
South Bow Corporation (NYSE:SOBO) is an independent energy infrastructure company focused on crude oil transportation and storage, primarily through its ownership of the Keystone Pipeline System. Headquartered in Calgary, the company benefits from stable, fee-based cash flows and strong operating efficiency. In an environment where energy security, infrastructure reliability, and AI-driven demand for power-intensive industries are gaining prominence, South Bow’s high-margin profile and strategic asset base position it as a compelling long-term investment with meaningful upside potential.
7. EQT Corporation (NYSE:EQT)
Net Profit Margin: 24.41%
Operating Margin: 35.66%
On March 27, Morgan Stanley raised its price target on EQT Corporation (NYSE:EQT) to $74 from $69 while maintaining an Overweight rating, citing structurally higher energy prices and tightening supply-demand dynamics across oil, LNG, and refining markets. The firm significantly increased its long-term commodity price assumptions, noting that global energy markets are unlikely to revert to prior levels given ongoing geopolitical and structural constraints. This shift has driven a substantial upward revision in EBITDA forecasts across the sector, highlighting the scale of earnings leverage available to leading natural gas producers.
On the same day, BMO Capital raised its price target on EQT Corporation (NYSE:EQT) to $76 from $68 while maintaining an Outperform rating, emphasizing the company’s ability to generate outsized free cash flow. EQT’s integrated midstream and marketing platform allows it to capitalize on pricing dislocations, while growing in-basin demand—particularly from LNG exports and AI-driven data center energy consumption—provides additional tailwinds. The firm also noted continued progress on takeaway capacity expansions, which enhance long-term growth optionality.
EQT Corporation (NYSE:EQT) is the largest natural gas producer in the United States, with core operations in the Marcellus and Utica shale formations. With a history dating back to 1888, the company has evolved into a scale-driven, low-cost operator with significant exposure to structural demand growth. As global energy markets tighten and demand from LNG and AI infrastructure accelerates, EQT is uniquely positioned to deliver strong free cash flow and sustained growth, supporting a high-conviction investment thesis.
6. Cheniere Energy Inc (NYSE:LNG)
Net Profit Margin: 27.10%
Operating Margin: 27.02%
On April 2, Citi raised its price target on Cheniere Energy Inc (NYSE:LNG) to $55 from $49 while maintaining a Sell rating, noting that geopolitical disruptions could have lasting implications for global energy markets. The firm highlighted that supply dislocations stemming from the Middle East conflict are likely to increase long-term demand for U.S. liquefied natural gas exports, positioning LNG infrastructure providers as key beneficiaries of evolving global trade flows.
On March 27, JPMorgan raised its price target on Cheniere Energy Inc (NYSE:LNG) to $63 from $57 while maintaining an Underweight rating, reflecting updated assumptions based on current commodity pricing trends. While near-term valuation concerns persist, the firm acknowledged the supportive pricing environment and strong demand fundamentals underpinning the LNG market.
Cheniere Energy Inc (NYSE:LNG) is the largest producer of liquefied natural gas in the United States and a critical player in global energy markets, operating major export terminals in Louisiana and Texas. Headquartered in Houston, the company is strategically positioned to benefit from the growing importance of LNG as a flexible and scalable energy solution. With strong margins and direct exposure to rising global demand—driven by energy security concerns and the rapid expansion of AI and data center infrastructure—Cheniere represents a high-quality investment opportunity with significant long-term upside potential.
While we acknowledge the potential of LNG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than LNG and that has 100x upside potential, check out our report about the cheapest AI stock.
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