NPV for the large cap stock is concentrated 79% on natural gas and NPV looks low compared to our estimates for some thirty other producers. On the earnings conference call, Chairman Bob Simpson called attention to XTO’s price hedges that are protecting cash flow while natural gas pricing may be shaping up like the last half of 2006.
We note the trend in long-term natural gas price appears to be up by a slim margin compared to its 40-week average despite volatility of short-term quotes. Finally, XTO stock may be timely as it is below the 60-day average while retaining positive momentum above the 200-day average.
XTO 1-yr chart:
Originally published on July 24, 2007.