Chesapeake’s biggest investor grows more bullish on the stock

The outlook for Chesapeake Energy (CHK +1.7%) is on the upswing because CEO Doug Lawler has made substantial progress since taking the helm last June, top shareholder Southeastern Asset Management says in a letter today.

Lawler’s “capital discipline and operational effectiveness will reward shareholders,” according to the owner of ~10% of CHK shares.

Lawler has voiced plans to cut spending 20% this year, bringing it down to less than half of 2012 levels as CHK sells assets and spins off its oilfield services division.

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Comments (4)
  • mudchief
    , contributor
    Comments (6) | Send Message
    And 5 to 7 mcf gas with decent spending and decent cost on recurring debt will make 34 dollor stock and 50 dollar buy out
    17 Apr 2014, 11:48 AM Reply Like
  • Hank890
    , contributor
    Comments (2338) | Send Message
    Who will buy them,...who is large enough and needs to do so to maintain their own growth profile?


    And how will $5+ NG be sustained without additional large new sources of demand? The electric utilities that were going to convert from coal, have mostly done so at this point, no? Where are the truck fleets that supposedly were going to be transitioning to NG from diesel,...have they grown sufficiently in the past 18 months to aggregate large new demand? My perception is that the installed base of incremental NG vehicles (CMI) has hardly made a dent yet.


    In theory NG should be replacing dirtier and more expensive fuels,...true,...but theory is lagging reality, appears...does anyone have fresh data to illuminate this question?
    17 Apr 2014, 11:51 AM Reply Like
  • BTM
    , contributor
    Comments (520) | Send Message
    $5 NG should be easily sustainable. Later this year LNG will begin exports. NG is considerably higher everywhere else in the world.


    This past winter has shown that a cold winter can lead to $5 NG. With normal winters and LNG exports I suspect $5 NG becomes sustainable. I think $6-7 NG is a bit of a stretch right now but $5 ought to be doable.
    17 Apr 2014, 01:23 PM Reply Like
  • auto44
    , contributor
    Comments (3672) | Send Message
    Hank890 Look to locomotives and ships for diesel to gas conversions for the surface transportation demand and not all power plant conversions are nearly done. It is comforting to see big boys think CHK has the promise that I see in the business.
    17 Apr 2014, 01:44 PM Reply Like
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