No bankruptcy for 2 years. In those 2 years what all can happen- Asset prices can go up dramatically. Even before that the company will get offers of buyout. Icahn is not going to sell it cheap.
They need to get volume of sellers to cover. If you wait too long the sellers volume will dry up and there will be a short squeeze. All this week sellers : buyers was 20:1. now they are sort of even.
I am not sure but I think the value+the interest for a month may equal to the maturity value? Interest rate has been going up to almost 300%/ 25% for a month so the price should be around 75. I don't look at bonds. So I don't know for sure. Am I even thinking sort of right?
Just orderly sell off. 10:1 sellers to buyers. Fear of bankruptcy is there whatever the company says. i think it will be there until oil goes up and for that oil producers have to meet. They are just waiting to see who blinks first......
Oil lows, Nat gas bearish inventories testing previous bottom, bankruptcy rumor, upcoming earnings which doesn't allow the company to explain things in detail.
Note that they haven't warned on earnings- so they may be OK. Or even positive- and they could go into detail of all their restructuring efforts. Feb 24 can only be positive..
They are hedged for 2016. They can sell at much higher prices where they see a profit or they would have laid off more. They do this far in advance.
Unemployment data comes better than expected. Yellen is dovish in spite of strong employment- she is looking at inflation now.
Yesterday's oil inventory was bullish -still oil tested Jan bottom (but didn't take it out). More employment= more money= more driving fueled by cheap gas. Obama's 10 dollar gas tax will not materialize ever.
Saudis have promised to decide on cutting oil production after watching Iran's output. Going to happen soon. Higher demand and production cut may send oil this summer to last summer prices.
All the big oil companies have hedged for 2016 as well ...
Gluggo& scquick 48:
I looked this up and I thought i will share this info. I don't think a commodity company like CHK with all its assets will have any reason to do this. If they have hedged meaningfully for 2016 there is nothing to worry about.
I never short...
When a company files for Chapter 11 bankruptcy, the management of the company is still in charge of the daily operations. That said, significant business decisions, especially those pertaining to debt or debt securities, are sent to the bankruptcy court for approval. While the firm is in Chapter 11, its stock will still have value, but there is a temporary trading freeze. Although the stock will be delisted, over the counter (OTC) trading may still occur. In other words, the equity a broker has invested in the firm is not valued at zero, but their true value cannot be easily determined since the shares are no longer publicly traded.
If the company proceeds to file for Chapter 7 bankruptcy, the company's creditors are paid in a specific order. Generally, investors or creditors are paid in the following order:
1) Secured creditors
2) Unsecured creditors
Usually, little to nothing is leftover for shareholders after the more senior creditors are paid. However, if the company restructures and emerges from Chapter 11 as an improved organization, its share price may rise to higher levels than previously witnessed.
When a corporation is on the verge of bankruptcy, its stock value will reflect the risk that a Chapter 11 may become a Chapter 7. For example, a company traded at $50 may trade at $2 per share due to bankruptcy speculation. If Chapter 11 is actually filed, the stock price may fall to 10 cents. This value is composed of the potential income that shareholders may receive after liquidation and a premium based on the possibility that the firm may restructure and begin to operate successfully in the future. Private investors can buy and sell these 10-cent shares in the OTC market. The actual value does not reach zero unless the probability of restructuring is so low that a Chapter 7 filing is sure to follow.
I heard him saying he was thinking of buying the debt cheap....he has equity anyway ..