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Chesapeake Energy Corporation (CHK)

  • Mon, Mar. 23, 6:13 PM
    • Chesapeake Energy (NYSE:CHK) is now +3.5% premarket after Carl Icahn disclosed he has increased his active stake in the company to 73M shares, or 10.98%, up from 66M shares (9.98%) in December.
    • Southeastern Asset Management maintains the largest holding in CHK, with an 11.1% stake as of Dec. 31.
    • During after-hours, CHK also lowered its 2015 capital spending outlook by $500M, citing weak commodity prices.
  • Mon, Mar. 23, 4:49 PM
    • Chesapeake Energy (NYSE:CHK) announces further reductions to its 2015 capital spending budget, now seeing capex of $3.5B-$4B, $500M less than previous guidance of $4B-$4.5B.
    • CHK says it plans to operate 25-35 rigs in 2015 vs. last year's average of 64 rigs, and intends to spud and connect to sales a respective 520 and 650 gross operated wells vs. 1,175 and 1,150 wells in 2014.
    • As a result, CHK lowers its targeted 2015 production to 231M-236M boe, or 635K-645K boe/day, which represents 1%-3% Y/Y production growth after adjusting for 2014 asset sales.
    • CHK -0.2% AH.
  • Fri, Mar. 20, 5:20 PM
    • Despite the steep drop in energy prices, most investment-grade E&P companies face little risk of default because they are well-managed, diversified and have plenty of cash, according to analyst Philip Adams of bond rating firm Gimme Credit.
    • Companies Adams believes are in strong positions - with a starting cash position greater than his estimated free cash flow deficit - include Suncor (NYSE:SU), Chesapeake Energy (NYSE:CHK), ConocoPhillips (NYSE:COP), Hess (NYSE:HES) and Anadarko Petroleum (NYSE:APC).
    • Adams is “throwing in the towel" on only one company: WPX Energy (NYSE:WPX).
    • He expects energy prices will rise this year due to less drilling, disruptions in countries such as Libya and new regulations that curtail fracking, but warns that the glut will worsen if Iran rejoins the market.
  • Thu, Mar. 19, 9:09 AM
    • Chesapeake Energy (NYSE:CHK-3.4% premarket after Sterne Agee downgrades shares to Underperform from Neutral with a $9 price target, citing downside risk to its $2.70/Mcf 2015 Henry Hub natural gas forecast.
    • Sterne says it supports CHK's moves to remove balance sheet opacity, but financing decisions from the previous management are driving sub-optimal capital allocation amid depressed commodity prices.
    • The firm says it is late on the downgrade call given CHK's underperformance YTD, but believes shares remain overvalued as concerns on capital allocation and overall asset quality linger.
  • Tue, Mar. 17, 7:40 PM
    • Crude oil production at three major U.S. shale oil fields - the Eagle Ford in south Texas, the Bakken in North Dakota, and the Niobrara in Colorado and adjacent states - is projected to fall this month for the first time in six years, the Energy Information Administration says.
    • Net production from the three fields is expected to drop by a combined 24K bbl/day, but overall losses likely will be masked by production gains in the Permian Basin in west Texas and other regions.
    • It is one of the first signs that idling hundreds of drilling rigs and billions of dollars in corporate cutbacks are starting to affect the U.S. oil patch, but it also shows that drilling technology and techniques have advanced to the point that productivity gains may be negligible in some shale plays.
    • Top Eagle Ford producers: EOG, BHP, COP, CHK, MRO, APC
    • Top Bakken producers: CLR, EOG, WLL, HES, XOM, OAS, NOG, EOX, MRO
    • Top Niobrara producers: NBL, APC, ECA, CHK, EOG, WPX
  • Tue, Mar. 17, 7:12 PM
    • Most of the top 15 shale oil producers in the U.S. are heavily concentrated in basins expected by NavPort to be severely affected by the decline in prices, with one major exception: ConocoPhillips (NYSE:COP).
    • COP has the lowest well completion concentration in basins expected to suffer the greatest production cuts this year, implying less disruption than other shale competitors, according to NavPort, which collates oil well and rig data using regulatory reports.
    • All 14 of the other top producers tracked by NavPort have at least two-thirds of well completion concentrated in the basins rated with "strong" or "severe" exposure: CHK, APC, EOG, DVN, SWN, MRO, APA, SD, XOM, CLR, PXD, NBL, BHP, WLL.
    • Operators concentrated in basins that have been less severely affected - such as the Woodford, Utica and Haynesville basins - should enjoy more production than their peers through a higher volume of well completions, NavPort says.
    • The study sees the Mississippi Lime, Granite Wash, Bakken and Permian basins suffering at least a 40% Y/Y reduction in drilling.
  • Fri, Mar. 13, 9:19 AM
    • Exxon Mobil (NYSE:XOM) releases a statement suggesting ways the U.S. government should adjust its energy policies, including allowing U.S. exports of oil and natural gas, approving the Keystone XL pipeline, and making the regulatory process less burdensome and more transparent.
    • "The energy industry has been an economic engine for the entire nation at a time of recession, slow growth, and falling labor participation rates,” CEO Rex Tillerson says.
    • Also, several CEOs of U.S. drilling companies, including ConocoPhillips' (NYSE:COP) Ryan Lance, Marathon Oil's (NYSE:MRO) Lee Tillman, Chesapeake Energy's (NYSE:CHK) Doug Lawler and Occidental Petroleum's (NYSE:OXY) Steve Chazen, reportedly were in D.C. this week trying to persuade White House officials and lawmakers to lift the 40-year ban on U.S. oil exports.
  • Tue, Mar. 10, 11:15 AM
    • Chesapeake Energy (CHK -1.7%) is reiterated with a Buy rating and $24 price target at Wunderlich, which says the stock is at a 52-week low for what it believes are unfair reasons.
    • The firm notes the concern about CHK remains its balance sheet despite asset sales and simplification that have put the company in a great position, and while CHK has an outspend for 2015, it should be easily funded by the $4B in cash currently on the books.
    • Wunderlich also believes CHK's potential to make acquisitions in a depressed market and a $1B share repurchase program authorized late last year provide multiple avenues for CHK to add value, and now sees significant opportunity for investors at a compelling price.
  • Thu, Mar. 5, 4:49 PM
    • Chesapeake Energy (NYSE:CHK) declares $0.0875/share quarterly dividend, in line with previous.
    • Forward yield 2.2%
    • Payable April 30; for shareholders of record April 15; ex-div April 13.
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  • Fri, Feb. 27, 10:54 AM
    • Chesapeake Energy (CHK -2.4%) discloses that it expects to write down the value of its oil and gas properties in Q1, with more writedowns in subsequent quarters if prices stay low, according to its latest 10-K filing.
    • "Based on the first-day-of the-month prices we have received over the 11 months ended February 2015, we expect to have a material writedown in the carrying value of our oil and natural gas properties in the first quarter of 2015," CHK says.
  • Thu, Feb. 26, 11:59 AM
    • Chesapeake Energy (CHK -4.1%) is sharply lower for a second straight day following disappointing Q4 earnings, as UBS downgrades shares to Neutral from Buy and cuts its price target to $19 from $24.
    • The view is that CHK offered a "surprisingly weak outlook" for volumes and price realizations, and the company's adjustment to growth for Marcellus curtailments (+3%-5%) does not add up since CHK has little incremental contracted takeaway capacity in the future.
    • Also, Jefferies reiterates its Hold rating but with a reduced stock price of $16, as it guides CHK's headline volumes to fall 7%-8% in 2015.
    • However, Oppenheimer says the two-day decline is an overreaction to overspending; despite the big earnings miss, CHK has "one of the most attractive asset portfolios of any E&P company,” the firm says.
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  • Wed, Feb. 25, 3:28 PM
    • Chesapeake Energy's (CHK -9.5%) team of "value barbarians" has worked to bring the company's costs in line after years of overspending, but CHK will continue to outspend its cash flow in 2015, CEO Doug Lawler said in today's earnings conference call.
    • CHK is forecasting weak pricing for the full year in the Marcellus Shale, and says it started shutting in ~250M cf/day in Marcellus natural gas production in December; CHK plans to run only one drilling rig in the area this year, down from five rigs operating there last year.
    • On CHK's plans for the $5B it made on last year's sale of a big piece of its Marcellus and Utica gas business to Southwestern Energy, Lawler said CHK could use the money to pay down debt, fund its exploration program or acquire new properties or another company.
    • CapitalOne analysts consider Q4 results soft, telling clients that CHK's "weaker than expected liquids pricing plus 2015 guidance for production" likely would drive Wall Street estimates lower.
  • Wed, Feb. 25, 9:24 AM
  • Wed, Feb. 25, 8:18 AM
    • Chesapeake Energy (NYSE:CHK) -4.4% premarket after reporting weaker than expected Q4 earnings and saying it will cut its 2015 spending and rig count in response to lower crude oil prices.
    • CHK says it plans total capital spending of $4B-$4.5B in 2015, 37% lower at the midpoint than the $6.7B spent in 2014, and will operate only 35-45 rigs this year, the lowest number since 2004 and down from an average of 64 rigs in 2014.
    • Even with the cutbacks, CHK forecasts 2015 oil and gas production to grow 3%-5% to 645K-655K boe/day.
    • In Q4, CHK's average production increased 12% Y/Y to 729K boe/day, while revenue rose 11% to $5.05B and driven by 47% revenue growth in its natural gas, oil and natural gas liquid segment; operating expenses fell 4.7% to $4.09B.
  • Wed, Feb. 25, 7:05 AM
    • Chesapeake Energy (NYSE:CHK): Q4 EPS of $0.11 misses by $0.13.
    • Revenue of $5.05B (+11.2% Y/Y) beats by $220M.
    • Shares +0.35% PM.
    • Press Release
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  • Tue, Feb. 24, 5:30 PM
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Company Description
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.