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Wed, Feb. 3, 9:19 AM
Thu, Jan. 28, 7:02 PM
- A lower outlook for oil and natural gas prices prompts a round of reductions in energy company estimates, ratings and price targets at Wunderlich, which downgrades Chesapeake Energy (NYSE:CHK), Halcon Resources (NYSE:HK), Oasis Petroleum (NYSE:OAS) and Whiting Petroleum (NYSE:WLL) to Hold from Buy and SandRidge Energy (NYSE:SD) to Sell from Hold.
- Wunderlich also upgrades Cimarex (NYSE:XEC) to Buy from Hold with a $122 price target price, as the stock has weakened and the firm gives more credit to the company for its Cana-Woodford assets.
- The firm says nearly all of its covered companies that predominantly operate in the Bakken Shale are now rated Hold or Sell, but that it mostly reflects the tougher economics of the region rather than the quality of the companies.
Thu, Jan. 28, 9:23 AM
- Gainers: NEOS +59%. DNR +17%. BCEI +16%. UA +16%. FB +14%. INO +13%. ATHX +12%. PBR +12%. WLL +11%. MRO +10%. [[PBR-A]] +10%. TRXC +9%. CHK +9%. MLNX +9%. LINE +9%. MT +9%. SDRL +8%. HOG +8%. ETE +8%. STO +8%. CRUS 7%. KMI 7%. BBL 6%. HCA 6%. MJN 6%. CJES 6%. PYPL 6%.
- Losers: NOW -22%. OSIS -22%. EBAY -11%. INVN -10%. URI -10%. INCY -9%. JNPR -10%. OAS -7%.
Tue, Jan. 26, 9:22 AM
Mon, Jan. 25, 6:28 PM
- Chesapeake Energy's (NYSE:CHK) credit rating is downgraded to CCC+ from B with a negative outlook at S&P, reflecting the ratings firm's lower base case oil and natural gas price assumptions.
- S&P says it lowered its 2016, 2017 and long-term price assumptions for Henry Hub gas by more than 15% and WTI crude by ~20%%, which resulted in significantly weaker financial measures for CHK, with FFO/debt below 5% and debt/EBITDA well over 10x for the next two years; at such levels, S&P assesses CHK's debt leverage as "unsustainable."
- CHK was downgraded to B from BB- just last month.
- CHK finished today's trade -15.5% at $2.96.
Mon, Jan. 25, 9:14 AM
Fri, Jan. 22, 9:21 AM
Fri, Jan. 22, 8:34 AM
- Chesapeake Energy (NYSE:CHK) +7.9% premarket after announcing the suspension of quarterly preferred stock dividends in an attempt to save cash.
- CHK says the move will save ~$170M/year and allow it to buy its own debt at significant discounts.
- "Given the current commodity price environment for oil, natural gas and natural gas liquids, we believe that redirecting this cash toward debt retirement provides better returns for the company," CHK says.
Fri, Jan. 22, 8:28 AM
- Moody's places 120 oil and gas companies on review for a downgrade, in a sweeping global review that includes all major regions and ranges from the world's top global majors such as Royal Dutch Shell (RDS.A, RDS.B), Total (NYSE:TOT) and BP to 69 U.S. E&P and services firms.
- Warning of "a substantial risk that prices may recover much more slowly over the medium term than many companies expect, as well as a risk that prices might fall further," Moody's now sees both WTI and Brent crude averaging $33/bbl this year, a $7 cut for WTI and a $10 reduction for Brent from its previous forecast.
- The ratings firm also places 55 mining companies on review for downgrade as they battle a slump in commodity prices.
- Among the companies placed on review are Alcoa (NYSE:AA), Schlumberger (NYSE:SLB), Chesapeake Energy (NYSE:CHK), Transocean (NYSE:RIG), Statoil (NYSE:STO), Vale (NYSE:VALE), Goldcorp (NYSE:GG), National Oilwell Varco (NYSE:NOV) and Diamond Offshore (NYSE:DO).
- ETFs: XLE, VDE, ERX, OIH, XOP, ERY, FCG, DIG, GASL, DUG, BGR, XES, IYE, IEO, IEZ, FENY, PXE, PXI, FIF, PXJ, NDP, RYE, FXN, DDG
Thu, Jan. 21, 2:39 PM
- A new report from Sterne Agee CRT analyst Tim Rezvan suggests the situation for oil and gas E&P stocks is not as bad as the market fears for many companies.
- After studying liquidity positions of the E&P names under the firm's coverage, Rezvan concludes that only Chesapeake Energy (CHK +4%), Gastar Exploration (GST +13.2%) and Ultra Petroleum (UPL +25.7%) face potential credit issues prior to 2018.
- Conversely, Rezvan says Oasis Petroleum (OAS +8.5%) and Whiting Petroleum (WLL +11.3%) maintain strong liquidity despite sharp equity underperformance and can withstand the reduction in credit facilities expected this spring from lending banks feeling stress in their energy loan portfolios.
- The firm has Buy ratings on OAS and WLL, and Neutral ratings on CHK, GST and UPL.
Wed, Jan. 20, 3:48 PM
- Southwestern Energy (SWN +13.2%) reverses sharp early losses and power to strong gains, as gas-focused E&P companies may be seen as a safe haven for investors seeking energy stocks but are anxious to avoid exposure to crude oil prices near 13-year lows.
- "Gas is actually gives a bit of stability here,” Subash Chandra, managing director of Guggenheim Securities, tells Bloomberg, as gas producers already have adjusted to lower prices and are taking measures to stem a supply glut, similar to the one that crude oil is now navigating.
- Other notable gas-focused gainers today include Chesapeake Energy (CHK +5.8%), EQT Corp. (EQT +3.5%), Cabot Oil & Gas (COG +3.6%), and Range Resources (RRC +7.1%).
- "Gas has absolutely nothing to do with oil,” Oppenheimer's Fadel Gheit says, adding that the equities will advance if nat gas reaches $3.
- ETFs: UNG, UGAZ, DGAZ, BOIL, GAZ, FCG, GASL, KOLD, UNL, DCNG
Wed, Jan. 20, 9:13 AM
Tue, Jan. 19, 4:42 PM
- Chesapeake Energy (NYSE:CHK) fell more than 13% today to its lowest since April 2000, making it the worst performer in the S&P 500 Index, on investor concern that falling oil prices would hurt the company’s ability to repay debt.
- "Chesapeake tends to move more than others because of their financial leverage," says Subash Chandra, managing director of Guggenheim Securities, who says CHK and some other oil and gas firms will be "delevering for years."
- CHK shares have plunged 84% in the past year, and are down nearly 32% YTD.
- ConocoPhillips (NYSE:COP) was the day's second-worst oil and gas performer, falling as much as 9.6% before settling for a 7.4% drop, its lowest close since March 2009.
Tue, Jan. 19, 2:56 PM
- Oil and gas companies such as Devon Energy (DVN -6.5%), Chesapeake Energy (CHK -15.2%) and Continental Resources (CLR -15.1%) will be “in a delevering phase for years," Guggenheim analysts say.
- Guggenheim says CLR CFO John Hart recently revealed a post-recovery spending plan that still appears within cash flows, confirming its bias that the E&P sector will be in a delevering phase for years, so activity levels will be slow to ramp and will remain subdued.
- For levered growth to return, the firm says the sector should first have resized land, equipment and personnel completely; while CHK believes it is sized to run 40 rigs instead of the 12 now active, the firm says it is a good sign the company hopes to delever first.
Sat, Jan. 16, 9:15 AM
- Oppenheimer's Fadel Gheit and Luis Amadeo offer a bleak view of the Q4 2015 earnings season for oil and gas producers, warning of sharply lower earnings with deeper losses and wider cash flow deficits Y/Y and Q/Q.
- Among the integrated oil majors, the analysts see overall Q4 earnings falling by more than 50% Y/Y and more than 30% Q/Q; they expect Chevron (NYSE:CVX) to show the steepest earnings decline of 60%-plus Y/Y and 50%-plus Q/Q, while anticipating Exxon Mobil (NYSE:XOM) to report the lowest declines of 40%-plus Y/Y and 25%-plus Q/Q.
- Of the 15 large E&Ps Oppenheimer covers, 13 likely will report losses in Q4 vs. 10 in Q3 and none in Q4 2014, with only Devon Energy (NYSE:DVN) and Range Resources (NYSE:RRC) reporting a profit; the analysts expect most of the other 13 to report steeper declines, including Anadarko Petroleum (NYSE:APC), Apache (NYSE:APA), Chesapeake Energy (NYSE:CHK), EOG Resources (NYSE:EOG), Hess (NYSE:HES), Marathon Oil (NYSE:MRO), Murphy Oil (NYSE:MUR), Pioneer Natural Resources (NYSE:PXD) and Southwestern Energy (NYSE:SWN).
- Earlier this week, Gheit predicted that half of U.S. shale oil producers could go bankrupt before the crude market reaches equilibrium.
Fri, Jan. 15, 8:50 AM
- Losses are deepening in the market for low-rated energy debt, as investors worry that the prolonged slump in commodity prices and slowing economic growth will push many companies into default, WSJ reports.
- Bonds among the biggest losers yesterday were from WPX Energy (NYSE:WPX) and Oasis Petroleum (NYSE:OAS), each down ~12% from the previous day, according to the report; a 2019 bond from OAS traded at $0.53 cents on the dollar, and a WPX bond maturing in 2023 traded at $0.655.
- The losses come after many investors already have exited some larger oil and gas producers in the junk market; for example, a 2023 bond from Chesapeake Energy (NYSE:CHK) is trading at $0.285, roughly the same as in mid-December.
- Energy sector junk bond losses already are near 4% YTD, and the spread vs. U.S. Treasurys hit 14 percentage points on Wednesday, the highest since December 2008, according to Barclays.
- ETFs: HYG, JNK, HIX, HYLD, DHY, PHT, EAD, HYT, JQC, CIK, DSU, HHY, SJB, NHS, PHF, ACP, FHY, ARDC, MCI, VLT, KIO, CIF, AIF, MHY, ANGL, PCF, DHG, MPV, IVH, HYLS, JSD, UJB, CJNK, GGM, QLTC
Chesapeake Energy Corp is a natural gas and oil exploration and production company. It explores, develops and acquires properties for the production of natural gas and crude oil from underground reservoirs and also provides marketing & midstream services.
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