Jerry Jones’ Bet is Good, But This Stock is Better
Comstock’s recent Haynesville divestiture offers fresh insight into how the market is mispricing a neighboring gas company.
Jerry Jones has built a legendary track record as a businessman. He’s perhaps best known for his purchase of the Dallas Cowboys for $140 million in 1989 and turning it into the now most valuable franchise in the NFL, worth roughly $13 billion.
Now, Jerry’s betting big on natural gas. In a recent interview, he said:
“There’s $100 billion present value with gas out there. That’s why I’m talking to you on the telephone rather than trying to fix our defense with the Dallas Cowboys.”
Jones’ natural gas exposure comes through his majority ownership of Comstock Resources, a leading producer with extensive acreage in the Haynesville region along the Texas–Louisiana border. The company is well positioned to benefit from the anticipated natural gas resurgence driven by expanding LNG exports and growing power demand from AI data centers.
I agree with Jones that there’s enormous present value in natural gas. But in my view, there’s a better way to capture it than owning Comstock shares.
Comstock’s recent sale of part of its Haynesville acreage provides a compelling data point for the potential value of another company I wrote about several months ago in The Deep Value, High-Performing Natural Gas Play That The Market Has Overlooked. Since that publication, that company I wrote about has outperformed the broader oil and gas market, as measured by the XOP Oil and Gas ETF:
Despite this rise in stock price, this company remains deeply undervalued relative to natural gas peers, particularly Comstock. The chart below shows how much gas production investors in this company receive per dollar invested, alongside an EV/EBITDA comparison with Comstock.
While third-party estimates suggest Comstock now trades roughly in line with its present net asset value, the company I own shares of still trades at an extreme discount. The recent Comstock divestiture highlights just how large that discount is.
