The common stocks of some natural gas companies which alreadyhad been showing a downtrend got caught in the sinkhole that wasMonday’s cliffjumper stock market and several established new lows.There was no one explanation for the declines in the stocks of someof the hardest hit, including Coastal Corp., Consolidated NaturalGas, Dynegy, El Paso Energy and Williams. Some were pointing to thecompanies’ exposure in the international arena or to declining oil,natural gas and liquids prices for the trend.

Although Coastal, for example, enjoyed second-quarter earningsper share that were 23% higher than 1997’s second quarter, thecompany’s stock Monday closed at a new 52-week low, 26 3/16 pershare, down 1 3/4. Coastal’s earnings have increased every quartersince 1993, said Stirling Pack Jr., director of investor relations,but that momentum is apparently being ignored by a stock marketwhere many energy company share prices are foundering.

“I think that we’re caught up in this market downturn, andparticularly the downturn in natural gas prices,” Pack said. “I’vespoken with a lot of our big [share]holders who are as confused aswe are about this.” There has been no change in Coastal’sfundamental outlook that would precipitate a share price decline,he said. Foreign exposure is minimal as well. “The only place thatwe’re exposed is in Pakistan, and we look for a favorable outcomethere as well with the two power projects that we have.”

Pack chalked the decline up to profit-taking. In talks with fundmanagers over the last week, he said he’s heard of forcedredemptions from individual shareholders and research directorspulling out of equities to strengthen cash positions. “You’re hitby that kind of market sentiment as opposed to any change infundamentals.” Also, lower gas prices of late have caught theattention of investors focused on the short-term.

Coastal’s 52-week range is 26 3/16 to 38 1/4 with the stock atits zenith in May and June. Coastal’s stock price began August inthe low 30s, dropped to the high 20s, climbed back up in the middleof the month and dropped again to the mid 20s.

Coastal reported second quarter earnings of $94.6 million, or 43cents per share (assuming dilution), compared to second quarter1997 earnings of $79.3 million, or 35 cents per share. Packpredicted a 30% increase in gas production this year over last.

El Paso Energy’s fortunes also have waned, at least for the timebeing. The stock closed at 25 Monday, down 3 7/8 and a new 52-weeklow. That compares with a 52-week high of 38 15/16. “We are stillcomfortable with our earnings estimate for the quarter which isright now at 42 cents, and we’re also comfortable with the estimatefor the year at $1.85,” said Scott Vonderheide in the company’sinvestor relations department. “All of our projects are on track.Our peer group is down in the market, down 500 points. It’s justbeen a very, very tough market.”

Like Coastal, El Paso had strong second-quarter results. ElÿPasohad record second-quarter earnings of 45 cents per diluted share,an increase of 22% from 37 cents per share in 1997. Consolidatedearnings before interest expense and income taxes (EBIT) for thesecond quarter increased to $149 million from $139ÿmillion in theyear ago quarter.

Williams dropped 2 1/16 to 23, nearing a 52-week low of 22 7/8.The stock’s 52-week high is 36 15/16. The company refused tocomment on its stock performance. For the second quarter, Williamsreported unaudited net income of $60.7 million, compared withunaudited restated net income of $118.5 million for the samequarter of 1997.

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