Once trading as high as $13 per 1,000 cubic feet, natural gas dipped below $8 on Monday. Anadarko Petroleum Chairman, CEO and President James Hackett chalked up the commodity's move to per usual volatility and said, “Natural gas will ultimately be very strong for a long, long time.”
Speaking to Cramer on set today, Hackett attributed nat gas’ fall in price to market sentiment that supply was way up and that big-money funds had been cashing out of their investments. The present level, he said, is a “very good number” for natural gas – his firm can still produce at as low as $5 – and he expects that number to get better over time.
“Perhaps it was overbought,” Hackett said of natural gas’ previous high, “now it’s probably oversold.”
“I think there’s still a great future for it,” he continued, because natural gas is the most viable “bridge fuel” as the U.S. seeks alternative-energy sources to reduce dependence on foreign oil.
Hackett thinks Anadarko , and peers like Apache and Devon, are undervalued right now by Wall Street, saying there’s “tremendous upside from here.”
And that value should only increase as properties overseas in Brazil, West Africa and elsewhere continue to produce, Hackett said, adding even more to the company – and the stock – over the long term.
Natural-gas stocks are down big lately, giving investors a nice discount price, Cramer said. He thinks a California initiative, which will show billions of dollars worth of increased nat gas usage, in November will be a huge catalyst for this stock.
When that happens, Cramer said, “You’re going to make a lot of money with Anadarko.”
Jim's charitable trust owns Devon Energy.
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