Dr. Hugh Akston
Hedge fund manager, long/short equity, value

The Shoes Begin To Drop At Gas Natural

Since our initial report on Gas Natural (NYSEMKT:EGAS), which warned that EGAS is not a "widows and orphans" utility company, the ensuing news flow has been foreboding. We cautioned investors that sticking around to collect a 5% dividend yield was like picking up pennies in front of a steamroller.

The subsequent events of the past four weeks reaffirm our view.

1. Auditor Resigns: The most ominous development of the past four weeks is the resignation of Gas Natural's auditor. On December 16th, EGAS received a notice of resignation from ParenteBeard LLC, the registered public accounting firm responsible for auditing the company's financial statements.

A change in auditor is never a good sign for a company. Often it...

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