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Will Ultra Petroleum Reap the Benefits of its Risky Move this Quarter?

By Tyler Crowe – Feb 13, 2014 at 10:00AM

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Ultra Petroleum has made a risky bet by not signing futures contracts for its natural gas production, and this quarter we will see if that has paid off

Ultra Petroleum (UPL) is known as a company that goes against the grain, especially during the surge in oil and gas production here in the US. With this quarter's earnings approaching, we will see if one of its riskier bets has paid off. Over the past several quarters, the company has lefts its natural gas production exposed to the daily price swings in natural gas. By doing so, the comapny hoped that natural gas prices would rise. Based on recent spot prices, the company was right.  

Of course, a hedging strategy isn't the sole reason to invest in a company. To find out what else Ultra Petroleum investors should watch for and to learn more about hedging strategy for oil and gas companies, tune into the video below.

Tyler Crowe has no position in any stocks mentioned. You can follow him at Fool.com under the handle TMFDirtyBird, on Google +, or on Twitter, @TylerCroweFool. 

The Motley Fool recommends Ultra Petroleum. The Motley Fool owns shares of EOG Resources and has the following options: long January 2016 $25 calls on Ultra Petroleum. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Ultra Petroleum Corp. Stock Quote
Ultra Petroleum Corp.
UPL
Andeavor Stock Quote
Andeavor
ANDV
HollyFrontier Stock Quote
HollyFrontier
HFC
Continental Resources Stock Quote
Continental Resources
CLR
$74.27 (0.04%) $0.03
EOG Resources Stock Quote
EOG Resources
EOG
$142.64 (-0.01%) $0.01

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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