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Here's Why You Should Hold on to Range Resources Stock Now

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Range Resources Corporation (RRC - Free Report) is a leading natural gas exploration and production company. For 2025, the company is likely to see earnings growth of 40%.

What's Favoring RRC Stock?

In its latest short-term energy outlook, the U.S. Energy Information Administration revealed that it expects Henry Hub spot natural gas to be higher at $3.10 per million British thermal units (MMBtu) in 2025 compared with less than $2.00 per MMBtu in August. This can benefit the leading natural gas producer, Range Resources, which carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.     

RRC has decades of low-risk drilling inventory in Appalachia, brightening its production outlook. The company has lower well costs per lateral foot than many other upstream players.

The exploration and production player also has a strong focus on strengthening its balance sheet. Over the past several years, RRC has consistently reduced its net debt load. The company has the lowest emission intensity among the upstream companies in the United States.

Risks to RRC’s Business

In spite of the positives, RRC’s overall operations are significantly exposed to extreme oil and natural gas price volatility. Other major exploration and production firms that are also exposed to commodity price volatility are ConocoPhillips (COP - Free Report) , Diamondback Energy, Inc. (FANG - Free Report) and Matador Resources Company (MTDR - Free Report) .

ConocoPhillips has secured a solid production outlook thanks to its decades of drilling inventories across its low-cost and diversified upstream asset base. The resource base represents the company’s strong footprint in prolific acres in the United States, comprising Eagle Ford shale, the Permian Basin and Bakken shale.

Diamondback Energy, a leading pure-play Permian operator, has reported ongoing enhancements in the average productivity per well in the Midland Basin. Thus, the exploration and production company will likely continue witnessing increased production volumes.

Matador Resources recently entered into a $1.91 billion agreement to expand its footprint in the prolific Delaware Basin. With the deal expected to close in the late third quarter of 2024, the company is projected to have more than 190,000 net acres in the Delaware Basin on a pro forma basis.

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