Why Has Rice Energy Stock Been on Uptrend since February 2016?



Rice’s moving averages

Rice Energy (RICE) stock was mostly declining in 2015. However, with the recent rally in natural gas prices (UNG), the stock has been on an uptrend since February 2016.

On January 29, 2016, RICE stock crossed its 50-day moving average (or DMA) for the first time in 2016. However, it wasn’t able to sustain and fell below its 50-DMA only to cross it again on March 2, 2016. Currently, RICE continues to trade above its 50-DMA. On August 16, 2016, RICE stock was trading ~15% above its 50-DMA.

RICE also broke above its 200-DMA in early April and continues to move higher. The fact that its 50-DMA has crossed above the 200-DMA is a very bullish sign.

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As of August 16, 2016, Rice stock was trading ~68% above its 200-DMA. Year-over-year, Rice stock has increased by 27%. Meanwhile, peers Noble Energy (NBL) and Antero Resources (AR) have increased 1.1% and 1.8%, respectively. All these companies combined make up 3.9% of the iShares US Oil & Gas Exploration & Production ETF (IEO).

Rice’s stock price recovery

As you can see in the above graph, RICE stock has recovered significantly in 2016, crossing its year-ago levels. In 2016, RICE has increased ~138% year-to-date. RICE’s aggressive steps to counter low prices and the turnaround in natural gas prices have helped this increase.

Next, we’ll take a look at Rice Energy’s key management objectives.


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