Chesapeake Energy Corp. (NYSE:CHK) - - Buy / Sell / Hold - or - Hold-Cash ? ? ?
This fine / quality Company is one of the S&P - 500 component Companies that is currently what I call "An Easy Call." My Analytics have (CHK) on both on my "Hold" and "Favorable" Lists since mid 2012. It has an improving and positive Fundamental Valuation, but unfortunately, it Technically remains in a Bearish "Un-Confirmed" -- Phase / Cycle. Be Patient!
After many years of experience in Forecasting and Recommending securities for both Buying and Shorting to my Clients - - for me, it boils down to two criteria. The first I call - "Easy Calls" and "Tough Calls" - and the second is - "Favorable" and "Un-Favorable."
When I am Bullish and focused on Buying, it is very clear to me that unless it (the security) is both and 'Easy Call' - and - 'Favorable' with Excellent Fundamentals and Technicals - I just move on until I find one that is. The opposite is true when my focus is Bearish for Selling or Shorting.
For the Record: I am currently Bearish on the General Market. Yes, a Rally will first take place, but that is just part of the Bigger Picture and my Forecast.
As an old financial analyst / asset manager, I can easily determine if a Company or ETF is currently "Rotating" (or if you prefer the word "Cycling") into a "Favorable" condition for Buying - - or - - an "Un-Favorable condition for Selling or Shorting. You might check out my Article - "Rotation."
When you have a large universe of nearly all the conservative / quality Companies on the planet, as I do, it is often remarkable to Investors when I say: "There are always many Excellent Companies that are both 'Easy Calls' - and - 'Favorable' at or around a Bullish Inflection Point. The reciprocal or opposite is true for Bearish Inflection Points.
When making Formal Recommendations, I am simply looking for a decent Probability for Profit. My threshold for a profitable selection of a Company or ETF is at least 20% or more - that is when I Recommend a security to my Clients or Prospective Clients. Here are two quick URLs that you may want to read - as part of - how I go about profitable managing securities.
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Chesapeake Energy Corp. -- (CHK)
The Company has fundamentally been on hard times, which is reflected in its current selling price. There is improvement brewing but when the General Market enters a Bearish Cycle that should affect price appreciation. It was on a high of $35 and has been descending since that date. So, where is it going (price wise) from here? Answer: It is way too early in its "possible" recovery phase to be SURE! Feel free to let me know if you are interested in my Guidance and Direction on this or perhaps another security.
Fundamentals: (My "Old-Fashioned Valuations Methods" (which demand comparative Excellence) must first be - in Place before Taking Positions). My projected Earnings Growth "Valuations" for (CHK) is clearly ASCENDING. Like so many S&P Companies, the sweak price appreciation since early 2011 has perhaps used up the Earnings positives and does not support further strong price appreciation. Maybe NOT! Stay with me. Until more recently the current Price / Earnings Ratio (P/E) and Price of (CHK) has not kept up with many other stronger S&P Companies, and that is not currently good enough to become a confident Buyer.
Technicals: (My "Unique and Time-Tested Technical Indicators" (which also demand comparative Excellence) and also must first be - in Place before Taking Positions). My current Technical "Indicators" for (CHK) are all pointing to another Short-Term Rally. That is why currently this is "AN Easy Call." Buying is definitely not the prudent thing to do at this time and price.
I can help you with maximizing your profits - just ask. Any Company or ETF - Your Choice - and I will respond!
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Opinion: HOLD. If you own Chesapeake Energy Corp. - be prepared to take Profits or Losses after the next Rally. (Cash in your money-market account may bother you because of the low interest, but remember, you are more "bothered" when you lose money due to poor judgment on your part or from poor or misleading advice!)
Forecast: My (most current) Focus suggests that the price is TOPPING again in the Short-Term (one - three months). It - (CHK) is again on an Initial / Strong Bearish "Warning" and on my List to HOLD for now?
Industry Group Component Companies (Selective):
CHK, OXY, EPD, APC, EOG, APA.
Note: Please seek weekly (or more frequent) Guidance from a seasoned professional (minimum - 30 years or more of asset-management experience!). Remember - MOST "professionals" will advise holding or even buying. Do they EVER recommend selling or offer a Bearish "Warning" such as the above? And, Holding-Cash is considered a SIN!
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Want more detail? Please read my Bio here in SA and spend some time in the following URL about my Work / Profitability / Analytics and - - then, if you wish - - Send me an Email with your thoughts or questions. I will respond personally and promptly.
Thanks so very much for your time and following.
Smile, Have Fund "Investing Wisely,"