Investors have a chance to buy at a discount an oil-and-gas company that should deliver double-digit growth for the next four to five years, Cramer says.
XTO Energy’s bargain purchase of over a trillion cubic feet in natural gas reserves means it can lock in futures contracts at today’s much higher rate for a huge profit. The dip in the markets this week should give investors the chance to get it on the cheap.
The Fort Worth, Texas, company paid $2.5 billion, or $2.36 per unit, for 1.06 trillion cubic feet of natural gas properties throughout the Rocky Mountains and South Texas from Dominion Resources, giving XTO earnings growth and visibility most other oil companies just don’t have.
The way Cramer sees it, with present nat gas futures at $9 a unit, XTO could be coining money for the next 10 years if it starts selling now.