Range Resources CorporationRRC

Morningstar Rating

Stock Research and Analysis

by Justin Perucki, CFA

For most of its history, Range Resources' strategy involved acquiring legacy-producing properties on the cheap and boosting production rapidly. This served the firm well, but over time, Range has devoted more resources to finding and developing its Read more

Bulls Say

The firm has built up a substantial asset base in the last few years, which should provide it with plenty of drilling opportunities. Its reserves/production ratio stands at 19 years.

Range's assets in southwest Pennsylvania hold some of the best economics in the entire industry.

Lower industrywide activity should result in lower operating and capital costs in the near term.

It's appears Range's Marcellus acreage could keep the entire company growing for years to come.

Natural gas produced in the Appalachian Basin usually sells at a premium to Henry Hub, the industry benchmark. Read more

Bears Say

Proposed changes to the tax code, if enacted, could reduce Range's operating cash flow 20%-30%, all else equal.

Production growth may be constrained by infrastructure and regulatory constraints.

Lower industrial demand, coupled with strong supply growth in 2008 and the first half of 2009, could keep natural gas prices suppressed during the next couple of years. Read more

Strategy

Range likes to focus its efforts on a couple of core areas to develop expertise and cost synergies. This strategy should serve it well, especially in developing its shale acreage across the Southwest Read more

Management

CEO John Pinkerton has led Range Resources since 1992. Range's engineering and management team consists of several ex-Mitchell Energy employees. Mitchell was one of the leaders in unconventional natural gas before it was acquired in 2001 by Devon Energy Read more

Profile

Range Resources is a North American exploration and production company that focuses on unconventional natural gas. At the end of 2008, the firm had 2.7 trillion cubic feet Read more

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