Here are a few questions:
1) Is HGT the best way to play an increase in natural gas?
2) Does the share price accurately reflect the underlying value of the 80% royalty interest in the property or are shares overvalued just because of the dividend?
3) How are they selling gas at $4+ when it is $2? Are they hedged?
4) Would buying a MLP be a better way to play rising natural gas and which ones?
Agreed, plenty of time to buy. NG is probably not going to rise until end of year drawdowns start. The only question is whether it remains at a higher level or we go through the same again in 2013. I do plan to add some HGT and others later this summer.
I think HGT will bottom around $10. I think after another month or two of $.06 distributions, investors will become discouraged and begin to sell. Once HGT is yielding around 7% at the bottom, it will be a fantastic buy. If gas prices climb back to $4 over the next couple of years, holders that buy at the bottom will look to gain both distribution increases and capital gains...but in the meantime, we are looking at continued drops in price and lower distributions.
It's not hedged. These trusts are not allowed to add hedges. I already explained the prices. That is the price inclusive of liquids (NGLs). But HGT's gas is relatively dry and therefore lower priced. If you don't understand what I'm talking about you probably shouldn't invest in an area you don't understand.
HGT does not hedge.
Are you dense?
Liza answered your question several times.
HGT is benefiting from some pricing uplift of natural gas liquids.
The Hugoton field is not extremely rich in liquids, but it does have NGLs and those are lumped in with the natural gas.
HGT is going to suffer heavily as gas prices stay at $2/mcf.
That being said, when gas prices recover, it should recover faster (assuming liquids stay flat).
I like HGT as well as most of the other trusts, but HGT has to drop some more for it to be a buy (at least for me). If you annualize the $.06 distribution, this thing needs to drop to $9-$10 for it to be attractive.