UNG

We rate United States Natural Gas Fund, LP (UNG) as Avoid with a composite score of 32.0/100 at a current price of $11.40. The stock falls in the bottom quintile of our universe across key quantitative factors, and the multi-factor weakness suggests a high probability of continued underperformance.

The rating is primarily driven by strength in quality (35th percentile) and stability (30th percentile), which together account for the majority of the composite score. Offsetting weakness in momentum (15th percentile) and investment (23th percentile) tempers our overall conviction. We assign a No Moat rating (35/100), Low uncertainty, and Standard capital allocation.

Key items to watch: momentum to confirm whether the current price trend has legs; sustainability of the current growth rate; valuation compression risk if growth disappoints. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

United States Natural Gas Fund, LP holds a top-quartile position (#0 of 50) within the Finance, Insurance, And Real Estate sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 32.0/100 places it at rank #4375 in our full 7,333-stock universe. At N/A in market capitalization, United States Natural Gas Fund, LP is a small-cap player in the Finance, Insurance, And Real Estate space, which limits certain scale advantages but may allow for more agile strategic execution.

Revenue is growing at 60%, though momentum at the 15th percentile suggests the market has not yet fully recognized this trajectory. This potential disconnect between fundamental improvement and market recognition could represent an opportunity for patient investors if the growth trend persists.

Margin data is not available for United States Natural Gas Fund, LP, which limits our assessment of the company's cost structure and operating efficiency. We rely on factor-based signals to infer business quality in the absence of detailed margin data.

At a current price of $11.40, United States Natural Gas Fund, LP is trading at a premium to fundamental value. Our value factor score of 25/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. The premium valuation implies the market is pricing in significant future growth or quality improvements that are not yet fully reflected in current fundamentals.

Valuation multiples are not available for this company, which limits our ability to assess relative pricing. We rely more heavily on factor-based valuation signals in such cases.

We assign a Low uncertainty rating to United States Natural Gas Fund, LP. The company exhibits strong financial stability with a beta of 0.14, conservative leverage (4% D/E), and a stability factor in the 30th percentile. The predictable nature of the business model and solid financial position reduce the range of potential outcomes, giving us confidence in our fair value estimate.

Specific risk factors that inform our assessment include: below-average price stability (30th percentile); weak quality scores (35th percentile); low beta of 0.14 — while defensive, this may indicate limited upside participation in bull markets. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 30th percentile and quality factor at the 35th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: conservative leverage (4% D/E) limits balance sheet risk. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile is favorable for long-term investors.

We rate United States Natural Gas Fund, LP's capital allocation as Standard. Management has shown adequate — though not exceptional — stewardship of shareholder capital. Returns on equity stand at 5.2%, and the balance sheet is managed within acceptable parameters (D/E: 4%). Exemplary allocators typically sustain ROE above 20% and D/E below 50%; United States Natural Gas Fund, LP falls short on at least one dimension.

There is room for improvement in optimizing the capital structure or enhancing shareholder returns. Absent a dividend, the overall capital allocation framework would benefit from either higher reinvestment returns, improved balance sheet efficiency, or increased shareholder distributions. We will monitor for signs of strategic improvement that could warrant an upgrade.

In summary, United States Natural Gas Fund, LP receives a Avoid rating with a composite score of 32.0/100 (rank #4375 of 7,333). Our quantitative framework assigns a No Moat (35/100, trend: stable), Low uncertainty, and Standard capital allocation. The average factor score across quality, value, momentum, stability, and investment is 26/100.

Our analysis does not support a constructive view on United States Natural Gas Fund, LP at this time. The combination of limited competitive advantages, low uncertainty, and standard capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.