Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, natural-gas-focused explorer Ultra Petroleum (NYSE: UPL ) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Ultra's business and see what CAPS investors are saying about the stock right now.
Ultra facts
| Headquarters (Founded) |
Houston (1979) |
| Market Cap |
$7.29 billion |
| Industry |
Oil and gas exploration and production |
| Trailing-12-Month Revenue |
$963.55 million |
| Management |
Chairman/CEO Michael Watford (since 1999)
CFO Marshal Smith (since 2005)
|
| Return on Equity (Average, Past 3 Years) |
14.8% |
| Cash/Debt |
$22.89 million / $1.65 billion |
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 1,226 members who have rated Ultra believe the stock will outperform the S&P 500 going forward. These bulls include CAPS All-Star njmiles03, who is ranked in the top 10% of our community, and circaclown.
Last month, njmiles03 tapped Ultra as a great way to gas up: "Expecting natural gas use to increase over time. UPL is one of the lowest cost producers, potential for highest margins while remaining competitive."
Over the next five years, in fact, Ultra is expected to grow its bottom line at a solid rate of 16.5% annually. That's faster than other big natural gas plays like Apache (NYSE: APA ) (8.1%), Chesapeake Energy (NYSE: CHK ) (11%), and Devon Energy (NYSE: DVN ) (12.8%).
CAPS member circaclown elaborates on the Ultra bull case:
... I also am comforted to know that the smart money is betting that investing in natural gas is the right thing to do now. When the price corrects, and it will, the leanest companies (like UPL, I'll get into that in a second) and the behemoths stand to profit the most. I think the quote by Bill Miller real sums it up well, "The time to own commodities is when they are down, when everybody has lost money in them, and when they trade below the cost of production."
I like Ultra Petroleum because their production costs are $2.61/mcfe, and they are making money. 90% of their revenue comes from natural gas and the management looks to be competent and prudent. If I put down money on natural gas, it will be Ultra.
What do you think about Ultra, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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