Consol Energy: Deep Dive Into Gas Assets' Profitability Confirms Value Even At Current Prices
Value Pickings • 13 Comments
Value Pickings • 13 Comments
Consol Energy: A Bargain Net Asset Play That David Einhorn Likes For Good Reason
Munger Fan • 15 Comments
Munger Fan • 15 Comments
Sep. 23, 2015, 5:40 PM
Sep. 16, 2015, 7:03 PM
- J.P. Morgan analysts warn that companies with large amounts of floating-rate debt - including Chesapeake Energy, Freeport McMoRan, Ford and GE - could be at risk if the Fed decides to raise interest rates.
- Companies with variable/floating-rate debt suffer a more immediate impact by a rate hike than companies with fixed-rate debt, the analysts say; variable-rate coupons typically reset quarterly, meaning that changes in the base rate flow through almost immediately to variable-rate borrowers, while fixed-rate borrowers do not see such an impact until they refinance or issue new debt.
- JPM lists 25 companies - not including financials - that have the “highest variable-rate debt as a percentage of market cap": FMC, NRG, FCX, AES, CVC, LVLT, PVH, CHK, FE, DVA, THC, OI, CNX, F, HCA, FOSL, RCL, JOY, GE, ADS, ALLE, HBI, GT, DNB, AN
Sep. 16, 2015, 12:22 PM
- Jim Chanos has racked up gains this year amid China’s slowdown after a three-year losing streak at his hedge funds, but he actually has larger bets against the energy industry, which also have contributed to recent profits.
- One of his short bets reportedly is against Consol Energy (CNX +3.3%), although Chanos last spoke critically about CNX in 2012; Chanos is said to have maintained a short bet against CNX, though its investment now is smaller than in 2012.
- WSJ reports that a July 2015 Chanos presentation for clients said CNX, which has dropped more than 60% YTD, was "driven by financial engineering.”
- Chanos has taken aim at other energy companies as well, saying last week that he was short Cheniere Energy (LNG +1.2%) and saying at a Las Vegas investment conference in May he was short major oil companies.
Aug. 20, 2015, 2:54 PM
- Soros Fund Management disclosed minuscule (for Soros) stakes in Peabody Energy (BTU +24.6%) and Arch Coal (ACI +42.1%) at the end of last week. Combined, the Peabody holding of 1.03M shares and Arch holding of 533K shares amounted to less than $2.5M versus AUM north of $20B.
- The tiny stakes in the two near-bankrupt coal producers could be thought of as a lottery ticket, or maybe it's just The Palindrome - well known for railing against coal as it pertains to climate change - tweaking his political enemies.
- The stocks of both companies didn't do a whole lot for two sessions after the disclosure, but soared yesterday as Arch Coal was reported on working out a debt swap compromise with its creditors.
- News China could be producing a whole lot less in the way of carbon emissions than previously thought could be sending the two flying higher again today.
- CLD +3.9%, WLB +1.4%, RNO -2.15%, CNX -0.8%, KOL flat
Aug. 14, 2015, 3:52 PM
- Consol Energy (CNX -0.1%) hit a new 52-week low yesterday, and Cowen analysts cut their stock price target to $20 from $35, but that’s still more than 50% above current levels and the firm says CNX "maintains ample tools to drive improved results" even amid material deterioration in the group.
- In reiterating its Outperform rating, Cowen says CNX’s ambitious cost cutting and capital spending targets will be crucial to weathering the ongoing storm in commodities, and that the company has shown strong progress to date.
Aug. 4, 2015, 2:39 PM
- Consol Energy (CNX -7.8%) sinks to new 52-week lows after Deutsche Bank cuts its rating to Sell from Hold with a $14 price target, cut from $27, citing potential downside on weakening coal and natural gas prices and the company's stressed balance sheet amid low operating cash flows.
- Deutsche Bank lowers its 2015-17 EBITDA estimates by 12%-22%, based on lower E&P and coal realizations and lower coal volume guidance for 2015, partially offset by SG&A and D&A cost improvements; as a result, the firm lowers NAV to $26 from $36, partially offset by lower capex.
- CNX shares have slumped 35% in the past month and 58% YTD.
Jul. 29, 2015, 6:50 AM
- CONSOL Energy (NYSE:CNX) declares $0.01/share quarterly dividend, -84% decrease from prior dividend of $0.06.
- Forward yield 0.23%
- Payable Aug. 24; for shareholders of record Aug. 10; ex-div Aug. 6.
Jul. 28, 2015, 7:59 AM
- Consol Energy (NYSE:CNX) says it will delay its planned IPO of a unit holding metallurgical coal assets because of weak prices, and would look to partner with a third party to grow the unit before taking it public.
- CNX took a unit holding power-generating coal assets public in April as part of a broader strategy to shift its focus to natural gas production, and it expected to take public a second coal unit holding met coal assets in Q4.
- CNX's Q2 net loss widened to $603M, or $2.64/share, from $25M, or $0.11/share, a year earlier; excluding items, the loss was $0.37.
- CNX's coal division produced 7.5M tons in Q2, the E&P division achieved record production of 75.5B cfe, up 45% Y/Y, and annual gas production guidance remains at 30% growth for 2015 and 20% for 2016.
Jul. 28, 2015, 6:50 AM
- CONSOL Energy (NYSE:CNX): Q2 EPS of -$2.64 may not be comparable to consensus of $0.01.
- Revenue of $648.94M (-30.8% Y/Y) misses by $149.65M.
Jul. 27, 2015, 5:30 PM
- AGCO, AHGP, AIXG, AKS, ALLY, AMG, ARG, ARLP, ARW, AUDC, AUO, AXE, BP, BTU, CIT, CMI, CNC, CNX, COMM, CPLA, CRY, CVLT, CYNO, DD, DHI, DHX, ECL, F, FBC, FCH, FDP, FMER, FSS, GLW, GPN, GRUB, ICLR, IPGP, IPI, IR, JBLU, JEC, KEM, LH, LPT, LYB, MAS, MMC, MRK, MZOR, NCI, NLSN, NOV, NTLS, OAK, OFC, PCAR, PCH, PCP, PFE, POR, RAI, RDWR, SALT, SIR, SIRI, ST, SVU, TXT, UPS, UTHR, WAT, WDR, WYN
Jul. 20, 2015, 6:55 PM
Jul. 20, 2015, 8:37 AM
- Consol Energy (NYSE:CNX) says it expects to report a Q2 loss from operations, primarily due to lower energy prices. and to record a "significant" impairment charge on its conventional shallow oil and gas assets because of continued depressed Nymex forward prices.
- CNX says it still expects to achieve prior guidance for total gas production of 71B cf and coal production of 7.1M-7.73M tons.
- Says it plans to discuss during its Q2 earnings call July 28 its plan to generate free cash flow while maintaining annual gas production guidance at 30% growth for 2015 and 20% for 2016.
Jul. 14, 2015, 3:16 PM
- Consol Energy (CNX +1%) says it is cutting another 10% of its staff - 290 workers in its gas and corporate divisions and another 180 workers from its coal operations - amid slumping prices for its coal and natural gas.
- It was just the latest in a series of cost-cutting moves: CNX laid off ~5% of its workforce in April, reduced shifts at its three Pennsylvania longwall mines in May, and told retirees last month it would cancel their health insurance benefits four years earlier than it had planned.
- However, CNX says it is not idling any of its coal mines, something many coal producers have done in the past year.
Jul. 13, 2015, 4:58 AM
- U.S. power stations generated 31% of electricity from natural gas in April compared with 30% from coal, research firm SNL Energy estimates, the first time that gas has overtaken coal. In 2010, the latter accounted for 45% of power.
- The milestone has been a long time in coming, with the shale boom causing gas prices to plummet and increasing regulation leading to higher expenses for coal.
- Coal tickers: WLT, ACI, BTU, ANR, CLD, RNO, WLB, CNX,
Jun. 29, 2015, 11:38 AM
- Coal stocks (KOL +0.3%) are rallying after the Supreme Court threw out the EPA’s first-ever rules requiring coal-fired power plants to cut emissions of mercury and other toxic air pollutants, saying the agency should have weighed the cost of compliance in deciding whether to regulate.
- The ruling means the EPA must go back to the drawing board, which possibly could push any new emissions rules past Pres. Obama’s time in office.
- Coal companies are enjoying hefty gains: WLT +28.2%, ACI +15.1%, BTU +11.2%, ANR +5.4%, CLD +5.2%, RNO +3.9%, WLB +1.9%, CNX +1.4%.
- Select utility names also are seeing some strength: AEP +1%, PCG +0.9%, D +0.6%, NEE +0.6%, EXC +0.3%.
Jun. 26, 2015, 11:38 AM
- Peabody Energy (BTU -10.2%) sees continued weakness, down ~10% so far today and 20% on the week, although all coal mining shares (KOL -1.5%) have been hammered in recent days.
- Moody's downgraded BTU's corporate credit rating last night to B3 from B2 with a negative outlook, reflecting the rating agency's expectation of a more precipitous deterioration in the company's credit metrics than previously forecast due to the ongoing decline in the seaborne met coal markets.
- The firm sees BTU's debt/EBITDA ratio approaching 9x in 2015 and leverage remaining elevated at ~7x in 2016; absent asset sales, BTU is seen generating negative free cash flows in 2015 and 2016.
- However, BTU and other coal names have been sliding all week; Barron's Ben Levisohn speculates investors may be worried about the pending Supreme Court decision - in light of the Court's "having tilted leftward in its rulings" this week - on whether EPA rules that caused utilities to shutter some coal-fired plans are legal.
- Related tickers: ACI, WLB, CLD, ANR, WLT, CNX, NRP.
CONSOL Energy, Inc. produces coal and natural gas for global energy and raw material markets. The company operates its business through two primary divisions: Oil and Gas Exploration and Production and Coal Mining. The Coal division is focused on the extraction and preparation of coal. The Coal... More
Sector: Basic Materials
Industry: Industrial Metals & Minerals
Country: United States
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