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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Diversified Energy Company - Announces US$210m acquisition in East Texas

October 2022

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • DEC
  • Price:
  • 130p
Diversified Energy (DEC) purchases multiple portfolios of mature, low risk gas wells in the US, where it uses technology to wring out improved production performance. While not as dramatic as the energy spikes in the UK, the Henry Hub gas prices in the US have nevertheless risen from around US$3 / MMBTU (that’s one million British Thermal units) to over US$8 (down from a high of US$10) and while DEC is obliged to hedge forward because of the debt it has taken on, it will eventually benefit should prices stay elevated, which largely explains the shares briefly spiking to a high of 142p. Meanwhile, DEC is also a generous dividend payer; the latest quarterly payout was 4.2 US cents (3.7p), with sterling weakness giving shareholders more ban ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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