Chesapeake Energy: Geopolitics Can Help It Thrive, But Seems Overvalued

Zoltan Ban profile picture
Zoltan Ban
6.96K Followers

Summary

  • Chesapeake Energy Corporation spent most of the last decade trying to get away from its shale gas-dominated business by chasing liquid energy assets.
  • As it turns out, Chesapeake Energy's natural gas assets may become the basis for a successful decade, thanks in large part to geopolitical events that greatly increased demand for U.S. LNG.
  • With potentially many years of higher U.S. natural gas prices assured, Chesapeake can re-establish itself as a solid company, by shoring up its financial situation.
  • Chesapeake Energy's prime acreage situation remains a big question mark. It may be tough to turn a profit even within the current favorable natural gas price environment on the back of second-tier acreage.

Drone View Of An Oil Or Gas Drill Fracking Rig Pad with Beautiful Cloud Filled Sky

Joey Ingelhart

Investment thesis: The re-emergence of Chesapeake Energy Corporation (NASDAQ:CHK) after a disastrous decade of very low natural gas prices brought it to financial ruin may not make it seem like an exciting investment opportunity. It is

TTF versus HH natural gas spot price

Trading Economics

Chesapeake hedging positions

Chesapeake

Chesapeake hedging

Chesapeake

US LNG exports by destination

EIA

Chesapeake financial information

Seeking Alpha

This article was written by

Zoltan Ban profile picture
6.96K Followers
My name is Zoltan Ban,  I have a BA in economics. I am a personal investor with over a decade and a half of active trading experience.

Disclosure: I/we have a beneficial long position in the shares of SU either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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