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Here's Why Range Resources (RRC) is Worth Betting on Now

Zacks Equity Research

Range Resources Corporation RRC has witnessed upward estimate revisions for its 2020 bottom-line in the past 30 days. In fact, six out of eight analysts have revised their estimates upward. Also, this leading upstream energy player’s stock price has surged 20.4% year to date.

The company, carrying Zacks Rank #2 (Buy), has a strong footing in the prolific Appalachian Basin. In the gas-rich resource, the upstream firm has huge inventories of low-risk drilling sites that are likely to provide production for several decades. In fact, growing production has helped the company report better-than-expected results in first-quarter 2020.

Range Resources also has strong cost-control initiatives. The company’s cash unit cost of 1.93 per thousand cubic feet equivalent (Mcfe) was almost 9% lower year over year, aiding the bottom line. Importantly, the company is planning to spend roughly $430-million capital in 2020, lower than $728 million in 2019. In spite of the cut in spending, production in 2020 is expected to be around 2.3 Bcfe/D, almost flat with the 2019 levels. This reflects improving capital efficiency.

Moreover, the company is divesting non-core assets to focus more on profitable operations. Notably, since the second half of 2018, the company has executed the divestment of $1.1 billion worth of assets. Most importantly, since majority of Range Resources’ production comprises natural gas, the company is well poised to capitalize on the long-term clean energy demand.

Other Stocks to Consider

Other prospective stocks in the energy sector are Murphy USA Inc MUSA, Key Energy Services, Inc. KEGX and CNX Resources Corporation CNX. While Murphy and Key Energy sport a Zacks Rank #1 (Strong Buy), CNX Resources carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Murphy USA is likely to see earnings growth of 7% in the next five years.

Key Energy is expected to witness bottom-line growth of 97.2% in 2020.

CNX Resources has witnessed upward estimate revisions for 2020 bottom line in the past 60 days.

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CNX Resources Corporation. (CNX) : Free Stock Analysis Report
 
Range Resources Corporation (RRC) : Free Stock Analysis Report
 
Murphy USA Inc. (MUSA) : Free Stock Analysis Report
 
Key Energy Services, Inc. (KEGX) : Free Stock Analysis Report
 
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