Tags: BG | natural | gas | BRGYY

BG Group: Large-cap, Global Natural Gas

By Tim Plaehn   |   Wednesday, 14 Dec 2011 03:40 AM

Energy producer BG Group (BRGYY) may be the largest market cap stock you never heard of. This stock could fill a portfolio spot for a large cap global natural gas company, a sector where few other stocks come to mind.

BG Group is focused on the exploration, production and transportation of natural gas on a global basis. Exploration and production operations are under way on every inhabited continent. Gas transportation is focused on the ability to process liquid natural gas (LNG) for global shipment.

The company is involved in natural gas pipeline transport in the energy growth markets of Brazil and India. BG Group had an operating profit of $7 billion in 2010.

BG Group is a United Kingdom company, with shares trading on the London Stock Exchange and in the United States on the over-the-counter (OTC) market as American Depositary Receipts (ADRs). Each BRGYY ADR shares is worth five U.K. traded shares.

In 2010, the company started reporting the bulk of its financial results in dollars instead of British pounds. This makes sense, since the energy world is priced in dollars. U.S. investors thus are easily able to understand the financial reports but must remember the share ratio.

For example, the BG Group investor page lists the 2010 dividend as a total of 21.6 cents per share. Investors holding the OTC traded shares would have earned five times that amount, or $1.08. Dividends are paid semi-annually.

Recent results

For the third quarter of 2011, BG Group reported an operating profit of $1.94 billion, down slightly from the second and first quarter results of $2.15 and $1.96 billion, respectively. The third quarter decline was due to slight drops in both production and energy prices. Corporate goals are annual production growth rates of 6 percent to 8 percent through 2020.

BG Group is followed by 28 analysts from various countries. At the moment, 26 analysts have the stock rated as a buy or outperform.

The company reports next on Feb. 8.

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Energy producer BG Group (BRGYY) may be the largest market cap stock you never heard of. This stock could fill a portfolio spot for a large cap global natural gas company, a sector where few other stocks come to mind. BG Group is focused on the exploration, production and...
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