uploads///SWN WU_ Correlation

Southwestern Energy Didn’t Follow Natural Gas to the Upside


Dec. 4 2020, Updated 10:53 a.m. ET

Southwestern Energy’s stock performance

As we discussed in the previous part, Southwestern Energy’s (SWN) stock price fell ~2.7% for the week ending January 26, 2018. Natural gas (UGAZ) (DGAZ) (UNG) prices increased ~10.0%. So, it’s clear that Southwestern Energy’s stock price didn’t follow natural gas prices last week. In this part, we’ll discuss the correlation between Southwestern Energy stock and natural gas prices.

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Southwestern Energy’s stock price correlations

For the week ending January 26, Southwestern Energy stock showed a low correlation of approximately -26% with the natural gas (UGAZ) (DGAZ). Volatility in natural gas prices didn’t impact Southwestern Energy’s stock price most of the days last week.

For the week ending January 26, Southwestern Energy’s correlation with crude oil (SCO) (USO) and the SPDR S&P 500 ETF (SPY) was at approximately -66% and -60%. Southwestern Energy’s stock price wasn’t impacted much due to movements in crude oil (UCO) and SPY.

Southwestern Energy’s correlations in the past month

Southwestern Energy stock has shown correlations of approximately -70%, -79%, and -81% with natural gas (BOIL), crude oil (UCO), and SPY’s prices, respectively, in the past month.

Possibly due to the high level of debt concerns, Southwestern Energy stock wasn’t able to take advantage of rising natural gas prices last month. Southwestern Energy has almost 90% natural gas in its production mix. Southwestern Energy’s total debt-to-equity ratio, or leverage, is very high at ~269%.

To learn more, read Inventory Data: Natural Gas–Weighted Stocks Could Rise.


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