8 Most Undervalued Natural Gas Stocks To Buy According To Analysts

2. Ovintiv Inc. (NYSE:OVV) 

Upside Potential: 42.23%

Forward P/E Ratio as of December 9: 9.75

Number of Hedge Fund Investors: 44

Stock Price as of December 9: $41.20

Ovintiv Inc. (NYSE:OVV) is a Denver-based energy company specializing in the exploration, development, production, and marketing of natural gas, oil, and natural gas liquids across the United States and Canada.  The company’s key gas-focused assets include the Montney Formation in northeast British Columbia and northwest Alberta. The company also operates in the Horn River area in British Columbia and the Permian Basin in the United States, which are also known for their rich natural gas reserves.

Due to the low gas prices in the Waha hub near the Permian Basin, Ovintiv Inc. (NYSE:OVV) has been focusing on transporting additional gas out of the Permian to reduce exposure to local price volatility. In the Montney Basin, Ovintiv Inc. (NYSE:OVV) has been a pioneer in developing one of the most extensive and cost-efficient natural gas exploration in North America. In Q3, the company’s natural gas production exceeded the high end of its guidance, averaging 1,725 cubic feet per day. The company also increased its full-year natural gas production forecast to between 1,700 and 1,715 million cubic feet per day.

Ovintiv Inc. (NYSE:OVV) plans to continue diversifying its natural gas production across different basins. According to management, this approach is crucial because regions such as Western Canada and the Permian Basin have experienced significant drops in gas prices during the summer months. By spreading production across various regions, the company aims to mitigate the risk of low gas prices in specific markets.