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Natural gas stocks are one of the hottest commodity investments today.
At the end of March, the natural gas spot price spiked 3.92% to close at $4.48 per cubic foot.
Investors looking to tap into this lucrative market can consider a few well-performing top natural gas stocks as a stable asset to add to their portfolios.
The following recommendations are not only solid performers – they're cheap natural gas stocks that won't break the bank…
Three Affordable Top Natural Gas Stocks
Chesapeake Energy Corp. (NYSE: CHK) is the second-leading producer of natural gas in the United States. This is one reason why the company has developed a strong reputation among investors searching for top natural gas stocks. The company has connections to offshore production facilities and other exclusive sources of energy within the U.S., another factor that has enhanced the overall profile of the company on the open market.
CHK is a Marcellus shale gas producer – a geological area with one of the most profitable outlooks for 2014. The Marcellus estimated to have between 30 and 75 years' worth of natural gas reserves, so companies operating there stand to make decades worth of profits.
"The growth of the Marcellus over the next several years is likely to be nothing short of astounding," said a recent Morningstar report, which attributed the rapid growth to efficiency improvements.
Chesapeake's fourth-quarter natural gas production in Marcellus grew 36% year over year to 880 million cubic feet of gas per day, making it the company's single-largest hydrocarbon play. CHK stock was trading at about $26.13 on Tuesday and has a dividend yield of 1.30%.
Note: The Fed's 2014 taper means volatility ahead. So we've outlined how to find profits in a volatile market – like triple-digit gains in just days – if you start with this strategy…
Cheap natural gas stocks like Magnum Hunter Resources Corp. (NYSE: MHR), which sat at $8.80 per share on Tuesday, come at a bargain. MHR provides natural gas operations in the Appalachia basin and has connections to a wide array of pipelines that are operating in the area.
Magnum looks to be a great choice for local investors that want to make connections with a regional company – MHR has proven that it is a stable supplier of natural gas in the region, as is reflected by its diverse service listing.
With a share price of $21.23 as of Tuesday, Atlas Resource Partners L.P. (NYSE: ARP) is an up-and-coming independent developer and producer of natural gas, crude oil, and natural gas liquids (NGL). Since its founding in 1985, ARP has gradually begun to spread its influence in a number of ways.
Atlas operates in basins across the U.S. The company has over 8,000 different connections to natural gas supply sources, allowing it to maintain a stable production line. During the year ending Dec. 31, 2012, Atlas' average daily net production was approximately 77.2 million cubic feet equivalent.
ARP stock is up 3.66% in 2014 and has a 52-week range of $18.30-$25.71.
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