Liquid natural gas (LNG) exports to Europe and Asia, combined with the increasing electricity demand from data centers, are expected to significantly increase natural gas consumption in the U.S. and abroad in the coming years. Natural gas is a highly positive resource, as it is reliable, scalable, and relatively cleaner than other fossil fuels. That makes it an effective means to meet this demand. This is especially so since renewable energy sources like solar and wind face challenges related to intermittency and weather conditions. Based on recent Wall Street analyst reports and market insights, several natural gas stocks are well-positioned to benefit from this trend due to their roles in production, transportation, and infrastructure. With prices reaching $4.21 MMBtu and higher recently, it’s high time for investors to examine the top companies in the natural gas sector.
We screened our 24/7 Wall St. energy stock research database, looking for companies with the most significant presence in the natural gas industry. We also looked for companies that, although not directly involved in exploration and production, played a crucial role in the transportation and storage of natural gas and LNG. Five top companies appear on our screens, all of which are dividend-paying leaders in their respective sectors. Additionally, all are rated Buy by top Wall Street firms that we cover.
Cheniere Energy
As the leading U.S. LNG exporter, Cheniere Energy Inc. (NYSE: LNG) is positioned to benefit from both domestic AI-driven demand and international energy needs and pays a 1% dividend. Natural gas accounts for 43% of U.S. electricity production. Cheniere’s ability to scale operations quickly makes it a key player in this sector. The company’s export capabilities also provide a hedge against fluctuations in the domestic market. Some across Wall Street feel electricity demand growth could rise as much as 160% by 2030.
Cheniere Energy is a producer and exporter of LNG in the United States. The company provides clean and secure LNG to integrated energy companies, utilities, and energy trading companies worldwide. The company operates two natural gas liquefaction and export facilities. One is at Sabine Pass, Louisiana (Sabine Pass LNG Terminal), and another is near Corpus Christi, Texas (Corpus Christi LNG Terminal).
The Sabine Pass LNG Terminal, which features natural gas liquefaction facilities comprising six operational trains, has a total production capacity of approximately 30 million tons per annum (mtpa) of LNG.
The Corpus Christi LNG Terminal near Corpus Christi, Texas, consists of three trains for a total production capacity of approximately 15 mtpa of LNG, three LNG storage tanks, and two marine berths. It also owns and operates a 94-mile natural gas supply pipeline that interconnects the Sabine Pass LNG Terminal with several large interstate and intrastate pipelines.
Jefferies has a Buy rating with a $290 target price.
EQT
This top company is one of the largest natural gas producers in the U.S., particularly in the Appalachian Basin. It is recognized for being a low-cost producer with a dividend yield of 1.13%. EQT Corp. (NYSE: EQT) is a premier, vertically integrated American natural gas company with production and midstream operations focused on the Appalachian Basin. It has operations in Pennsylvania, West Virginia, and Ohio.
Its strategic position in the Southeast, especially near data center hubs like Northern Virginia, makes it a key supplier for AI-driven energy needs. EQT has secured agreements to supply natural gas to major data center campuses, such as the redevelopment of a former coal plant in Homer City, Pennsylvania, into a natural gas-powered data center.
EQT owns or leases approximately 610,000 net acres in Pennsylvania. Most of the acreage is located in the southwestern region of the state, with the majority located in Greene and Washington Counties. The company is developing the Marcellus Shale and Upper Devonian Shale in this area. It also owns or leases 405,000 net acres in West Virginia. Most of the acreage is located in the northwestern region of the state, with the majority located in Doddridge, Marion, Tyler, and Wetzel Counties.
It owns or leases 65,000 net acres in eastern Ohio and is developing the Utica Shale in Belmont County. It operates Utica wells throughout its Ohio acreage. The Marcellus Shale lies nearly a mile or more beneath the surface throughout much of Ohio, Pennsylvania, New York, and West Virginia.
UBS has a Buy rating, accompanied by a $67 target price.
Kinder Morgan
Kinder Morgan Inc. (NYSE: KMI) is one of North America’s largest energy infrastructure companies. This is one of the top energy stocks and remains a favorite among Wall Street, paying a solid and dependable 4.49% dividend. Kinder Morgan is an energy infrastructure company in North America.
The company operates the largest natural gas transmission network in the U.S., with approximately 66,000 miles of pipelines transporting around 40% of the country’s natural gas production. It serves 20% of U.S. power demand. That positions it to benefit from the projected 15% to 20% of electricity demand from AI data centers by 2030. The company’s extensive gas storage capacity (15% of U.S. total) and fee-based revenue model provide stability and growth potential as gas volumes rise.
Kinder Morgan operates through four segments:
- Natural Gas
- Products
- Terminals
- CO2
The Natural Gas Pipelines segment:
- Owns and operates the interstate and intrastate natural gas pipeline and underground storage systems
- Natural gas gathering systems and natural gas processing and treating facilities
- Natural gas liquids fractionation facilities and transportation systems
- Liquefied natural gas liquefaction and storage facilities
The Products Pipelines segment owns and operates refined petroleum products, crude oil, and condensate pipelines, as well as associated product terminals and petroleum OKE pipeline transmission facilities.
The Terminals segment owns and operates liquids and bulk terminals that store and handle various commodities, including:
- Gasoline
- Diesel fuel
- Chemicals
- Ethanol
- Metals
- Petroleum coke
- Owns tankers
Lastly, the CO2 segment produces, transports, and markets CO2 to recover and produce crude oil from mature oil fields. It owns interests in/or operates oil fields, gasoline processing plants, and a natural oil pipeline system in West Texas. It holds and runs approximately 83,000 miles of pipelines and 144 terminals.
Wells Fargo has an Overweight rating for the shares with a $34 target price objective.
Energy Transfer
Energy Transfer L.P. (NYSE: ET) is one of North America’s largest and most diversified midstream energy companies. This top master limited partnership is a safe option for investors seeking energy exposure and income, as the company pays a substantial 7.88% distribution. Energy Transfer owns and operates one of the largest and most diversified portfolios of energy assets in the United States. It has a strategic footprint in all the major domestic production basins.
Energy Transfer operates one of the largest integrated midstream systems in the U.S., with nearly 107,000 miles of natural gas pipelines and 235 billion cubic feet (Bcf) of storage capacity. Its strong presence in Texas, particularly in the Permian Basin, provides it with access to some of the country’s most affordable natural gas. The company is receiving significant inquiries for pipeline projects to serve power plants (45 plants across 11 states) and data centers (over 40 prospective projects). Potential demand exceeds 5 Bcf/d for power plants and 3 Bcf/d for data centers.
The company is a publicly traded limited partnership with core operations that include:
- Complementary natural gas midstream, intrastate, and interstate transportation and storage assets
- Crude oil, natural gas liquids (NGL), and refined product transportation and terminalling assets
- NGL fractionation
- Various acquisition and marketing assets
Following the acquisition of Enable Partners in December 2021, Energy Transfer owns and operates over 114,000 miles of pipelines and related assets in 41 states, spanning all major U.S. producing regions and markets. This further solidifies its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating, formerly known as Energy Transfer Partners, the company also owns Lake Charles LNG Company, the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco L.P. (NYSE: SUN), and the public partner interests and 39.7 million standard units of USA Compression Partners L.P. (NYSE: USAC).
Barclays has an Overweight rating to the shares, with a target price of $25.
Exxon Mobil
Exxon Mobil Corp. (NYSE: XOM | XOM Price Prediction) manages an industry-leading portfolio of resources and is one of the world’s largest integrated oil, gas, and chemical companies. It has a reliable dividend yield of 3.47%. The decline in oil prices presents investors with an excellent entry point, and they will likely seize the opportunity to capture a strong dividend yield. Exxon is the world’s largest international integrated oil and gas company. It explores for and produces crude oil and natural gas in North and South America, Europe, Asia, and elsewhere.
As a significant natural gas producer, Exxon benefits from the 43% share of U.S. electricity production powered by natural gas. Its scale and ability to ramp up production quickly make it a strong contender. Although, its broader focus on oil may dilute its AI-specific upside compared to pure-play natural gas companies.
Exxon also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene, and polypropylene plastics, as well as specialty products. Additionally, the company transports and sells crude oil, natural gas, and petroleum products.
Top Wall Street analysts expect the company to remain a key beneficiary in a higher oil price environment, and most remain very optimistic about the company’s sharp positive inflection in capital allocation strategy.
Upstream portfolio and leverage to a further demand recovery. Exxon offers greater Downstream/Chemicals exposure than its peers.
Exxon has completed its purchase of oil shale giant Pioneer Natural Resources in an all-stock transaction valued at $59.5 billion. The deal created the largest U.S. oilfield producer and guarantees a decade of low-cost production.
Wells Fargo has an Overweight rating with a $156 target price.
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