Southwestern Energy Company (SWN): One Rock-Solid Natural Gas Stock

Not only did Southwestern pay Chesapeake Energy Corporation (NYSE:CHK) a relatively paltry $93 million for the acreage – well below comparable transactions in the play over the past couple of years – the acquired assets were producing properties positioned near the company’s existing acreage. The purchase should also help support the company’s target of double-digit growth in both production and reserves, with CEO Steve Mueller even commentating that it could help double the company’s current production and reserve growth.

Final thoughts
For investors bullish on natural gas prices over the next five years, Southwestern stands out as a lucrative investment opportunity. In addition to a disciplined management team focused on value realization, Southwestern boasts a strong balance sheet and a relatively low debt to book capitalization ratio of 36%. As it focuses its $2 billion capital investment program on the Marcellus and Fayettville shales, production is expected to grow by 13% this year.

The article 1 Rock-Solid Natural Gas Stock originally appeared on Fool.com.

Fool contributor Arjun Sreekumar has no position in any stocks mentioned. The Motley Fool recommends Ultra Petroleum. The Motley Fool owns shares of Ultra Petroleum and has the following options: Long Jan 2014 $20 Calls on Chesapeake Energy, Long Jan 2014 $30 Calls on Chesapeake Energy, Short Jan 2014 $15 Puts on Chesapeake Energy, Long Jan 2014 $30 Calls on Ultra Petroleum, Long Jan 2014 $40 Calls on Ultra Petroleum, and Long Jan 2014 $50 Calls on Ultra Petroleum.

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