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Quicksilver Gas Services LP (KGS) Stock Offers Benefits Free of Industry Risks

The benefits are obvious, but some risks are not widely appreciated. The Utilities Sector shows a disturbing trend for the 12 months ended May 2008. The Gas Utilities Industry has fared a little better than its peers during this period. The crude oil outlook is unclear. That is why opinion is divided on how gas prices may fare in future.

This small-capital stock from Fort Worth, TX has a clear location advantage. The home base is front and center of one of the most exciting natural gas fields in all of North America. The management has been sanguine in leveraging a spatial advantage fully. It has been pro-active in securing gathering and processing rights to top natural gas resources in its neighborhood.

Stock investors wary of how the markets have behaved during June 2008 will be relieved to know that this stock is protected by a durable business model. The management takes fixed fees for gathering and processing natural gas, without necessarily owning titles to the commodity. This may not maximize profits in a bull run. However, it insulates the stock from fluctuations in natural gas prices. The Yield is 5.29 and the Earnings per Share are at 0.43. The stock price has settled near $24 towards the end of June 2008. Sales have grown annually on a Trailing Twelve Months basis by 173.90%. The Gross Margin has topped 69% during this period.

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