Caiman is owned by Williams Partners (NYSE:WPZ) and is in the storage and transportation business. Another firm that will profit when the gas is pulled out of the ground, Caiman has been positioning itself in Appalachia for just that. Williams is another firm that continually undercuts its share price by making large cash distributions to its shareholders. The yield right now is a very cheerful 6.27%. But that makes this a stock you don’t hold for growth, you hold it for the income. Which isn’t to say it hasn’t grown since the crash. It just hasn’t grown in the last year. A P/E of 20.53 shows there’s still some expectation among investors that there’s value to be had.
Hess Corp. (NYSE:HES)
Easily the most known name on this list for the casual investor, Hess runs gas stations and convenience stores around the country. Still, the firm is also involved in natural gas, at least for the moment. I hedge that a bit because, while the firm is indeed involved in the Appalachian gas boom, there’s news that a major shareholder is pushing for the firm to get out of the business and uncertainty is hanging over it. If you invest in Hess, make it for other reasons, not for its interest in Utica shale. The firm’s stock has climbed since last June from $39.99 to $67.42 so it’s done well. But the dividend is small at 0.59% and I’d want to see what happens before committing to it for natural gas.
Other than Hess, these are firms that don’t have a high profile. But that’s a good thing. Any casual investor can put their money in stocks they see every day. But companies whose value propositions are quieter or more under-the-radar? That’s where some real money can be made. So if you’re an energy investor, looking for firms poised to do well out of the Appalachian natural gas boom might just be a way to find some real value.
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The article Should You Invest in Shale Gas in Appalachia? originally appeared on Fool.com and is written by Nate Wooley.
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