0.4540 +0.01 (1.34%)
After hours: 7:56PM EST
|Bid||0.4518 x 800|
|Ask||0.4538 x 1200|
|Day's Range||0.4450 - 0.4710|
|52 Week Range||0.4300 - 3.5700|
|Beta (5Y Monthly)||2.38|
|PE Ratio (TTM)||N/A|
|Earnings Date||Feb 25, 2020|
|Forward Dividend & Yield||N/A (N/A)|
|Ex-Dividend Date||Apr 12, 2015|
|1y Target Est||0.80|
Chesapeake (CHK) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
One of Texas' oil and gas regulators on Tuesday defended the state's high rate of natural gas flaring, but named companies that burn off the most gas and said he would hold public meetings on the controversial practice. Flaring, or deliberately burning gas produced alongside oil, has surged with crude production in Texas, but can worsen climate change by releasing carbon dioxide. The report includes a set of flaring and venting data to be updated quarterly, the first set of such data the state has released.
Chesapeake Energy (NYSE:CHK) stock is but a sliver of what it was in its heyday. In 2008 it peaked at $70 per share. It is almost a penny stock today. So from an investment perspective, clearly any bullish trade here would be a speculative one. The bet is that the company will survive and CHK stock will show some signs of life.Source: Casimiro PT / Shutterstock.com It has been setting a series of lower highs and lower lows for a while, seeming unable to find a bottom. It did look like it would hold a bit under $2 per share, but even that eventually failed. Assuming that Chesapeake is now on the upswing, every prior floor will now become forward resistance. So if yesterday's rally sustains itself, I expect they could find resistance at 60 cents per share, and then again 10 cents higher.Eventually shares will have to face the $1 mark, which also would be a tough line to cross.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut this is like putting the cart before the horse. CHK stock must stabilize before it even makes a comeback. So the underlying assumption that it has indeed bottomed. If that turns out to be true, then the next thing to look for is a series of higher lows.What the bulls need to look for is the formation of a trough before one can expect a recovery rally. This can even happen while it continues to make lower highs. The battle between the bulls and the bears then become this new upside momentum versus the lower-high trend lines. The Trend Is Not the Friend of Chesapeake -- YetWhen a trend is this bad for this long, any bump in price remains suspect. So at best, yesterday's move could be the start of a trough in Chesapeake stock. But that could have been said in June, October and November of last year. Let this serve as a reminder that the recovery rally falls under the umbrella of speculative trades. It is hard to make a fundamental argument for a stock that behaves this badly. As they say, price is truth and it is screaming for caution. * 20 Stocks to Buy From the Law of Accelerating Returns The charts tell a horror story, so any money risked in upside bets on CHK is a lottery ticket. Meaning it shouldn't be an amount that can break the investor's hearts or their piggy banks. Otherwise it becomes a conviction trade, which Chesapeake is not worth here. Even the so-called experts in the field should remain very humble with their assumptions. Generally, it's not a good idea to fight the trend on Wall Street -- and this one is clear as day.To make matters worse for the Chesapeake bulls, the concept of fossil fuels are suffering through horrid sentiment right now. The rhetoric and the media are completely against it, and pursuing renewable energy is all the rage. This has always been the goal, but now it's in the headlines -- more so than before.This adds more downside pressure on all energy stocks, even the behemoths like Exxon (NYSE:XOM). The price of crude oil can't hold rallies either. This makes a potential recovery in CHK stock even more difficult. The Earnings Wild Card Is LoomingSource: Charts by TradingView In addition, Chesapeake's earnings report is coming up, and that too adds a coin flip aspect to near-term prices.It is always the case that the immediate reaction to the reports are binary. Chesapeake stock is so cheap that it gives the impression that the losses cannot be large. While that may be true in the absolute sense, the trade risk is still 100%, and that's the same result on 50 cents stock or $500. Investors' goals are never to lose money and it's easy to get a false sense of security and over-commit when the price is so close to zero.Regular risk controls should be in effect here too.Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room for free here. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 20 Stocks to Buy From the Law of Accelerating Returns * 10 Strong Lottery Ticket Stocks That Could Soar in 2020 * 7 U.S. Stocks to Buy on Coronavirus Weakness The post Will Chesapeake's Earnings Spark the Rally? appeared first on InvestorPlace.
Shares of Chesapeake Energy Corp. fell Thursday below the 50-cent mark for the first time in 26 years, after the International Energy Agency's downbeat assessment oil demand. The IEA cut its view on oil demand growth in 2020 to by 365,000 barrels a day to 825,000 barrels a day, the lowest level since 2011, as the coronavirus outbreak in China is expected to damp demand. That comes a day after the Organization of Petroleum Exporting Countries (OPEC) cut its 2020 growth outlook by 230,000 barrels a day to 990,000 barrels a day. The oil and natural gas company's stock fell 1.2% in afternoon trading to 49.83 cents. The last time the stock traded below four bits on an intraday basis was Jan. 21, 1994 and the last close below that mark was Jan. 19, 1994. Meanwhile, continuous crude oil futures rose 0.1%, and was headed for a third-straight gain after closing at a 13-month low on Monday. Natural gas futures fell 0.3%, after bouncing the past two days off Monday's 4-year low. Chesapeake's stock has plunged 80% over the past 12 months, while the SPDR Energy Select Sector ETF has shed 16% and the S&P 500 has gained 23%.
Oil prices fell again on Friday as the OPEC+ plans to deepen production cuts in order to counter bearish sentiment driven by Coronavirus demand fears hit a rut
Over the past three years, Enterprise Products Partners L.P. (NYSE:EPD) stock has dropped by 8.2%. Including dividends, EPD has eked out an 11% total return. And that's the good news, even if it doesn't seem like it.Source: Shutterstock After all, that period has been brutal for energy stocks more broadly. The Invesco S&P 500 Equal Weight Energy ETF (NYSEARCA:RYE) has declined 30%. Integrated majors like BP (NYSE:BP) and Chevron (NYSE:CVX) have held up, but even Exxon Mobil (NYSE:XOM) has lost nearly a quarter of its value, falling to a 10-year low last week.For producers, the news has been even worse, unless investors were fortunate enough to own Anadarko Petroleum before it was acquired by Occidental Petroleum (NYSE:OXY). OXY touched a 14-year low months after that deal was announced. For instance, Apache (NYSE:APA) is down by half. Small-cap names have seen absolute carnage: the Invesco S&P SmallCap Energy ETF (NASDAQ:PSCE) is down a stunning 71%.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIn that ugly environment, Enterprise Products has done its job. It's delivered solid income: the dividend yield currently sits above 6%, and has stayed above at least 5.5% for the last three years. And it's avoided significant principal losses even with unfavorable energy price movements. * 7 Utility Stocks to Buy That Offer Juicy Dividends Again, that's good news. The bad news, at least for oil bulls, is what that means for EPD stock going forward. Why EPD Stock Has Held UpAs a midstream operator, Enterprise Products Partners has far less sensitivity to oil prices. It's volume through the company's nearly 50,000 miles of pipelines that matters, along with demand for the company's storage, terminal and natural gas processing operations.Lower prices do lead to lower revenue, as was the case in 2019: revenue declined 10% for the full year and 13% in the fourth quarter. But Enterprise Products profits are based mostly on volumes, which mostly rose in Q4. Natural gas volumes did fall year-over-year, which is a modest concern. As another author has pointed out, rivals Kinder Morgan (NYSE:KMI) and MPLX (NYSE:MPLX) both saw increased natural gas volumes in Q4.From a broad standpoint however, prices aren't that material to EPD stock. It matters how much oil is running through an Enterprise pipeline. It doesn't matter how much that oil cost. That's for the upstream producers and the downstream refiners to worry about.And so despite falling energy prices, Enterprise profits actually rose nicely in 2019. So did cash flow, which backs an expected 2.3% increase in per-unit distributions this year. With nearly $8 billion worth of capital projects coming online in the next few years, according to the fourth quarter presentation, those distributions should continue to rise.That makes EPD, which yields 6.86% based on expected 2020 distributions, an attractive income play. As long as volumes hold up, so will distributions. And income investors will do far better in EPD stock than they would in 10-year Treasury bonds currently yielding less than 2%. What Goes WrongThe model certainly has worked so far. According to data from YCharts, total returns in EPD including dividends total 1,830% since the company's 1998 initial public offering. That's a 15% annualized return, one of the best in the market over that stretch.But there are risks. To begin with, EPD has significantly lagged the market more recently. Even with dividends, investors have essentially broke even over the past five years. Here, too, that's better performance than the sector as a whole, but it's certainly disappointing relative to the roaring broad market.Meanwhile, lower prices can impact EPD stock, even if somewhat indirectly. Again, at its core Enterprise Products is a volume play. If oil prices, in particular, keep falling, production in the Permian Basin and elsewhere may dry up. Kinder Morgan somewhat infamously proved the downside risk back in 2015, when it slashed its dividend by 75%. Shares plunged, and even with a recent recovery are down about half from 2014 levels.The company's MLP (Master Limited Partnership) structure also adds another layer of difficulty, as my InvestorPlace colleague Josh Enomoto detailed on this site. EPD unitholders are responsible for taxes passed through by EPD, which lowers after-tax returns and also requires additional work at tax time. Enterprise may eventually convert to a more traditional C-corporation, as have other MLPs in recent years. In the meantime, however, some income investors may see simpler options elsewhere in the sector. Not for Oil BullsIt's important to remember, too, that EPD stock isn't necessarily a great choice for long-term bulls. To be sure, higher prices no doubt will help, as they should stoke further production and higher volumes. Indeed, EPD benefited in the first half of the last decade from the shale boom and crude prices that at times cleared $100. But it's far from the best play.After all, there's no free lunch in the markets. Enterprise's model has allowed EPD stock to hold up even in an unfavorable price environment. But that model also limits upside should crude move to higher levels.For investors who see that scenario, producers are the play. Natural gas-heavy names like Cabot Oil & Gas (NYSE:COG) or EQT Corporation (NYSE:EQT) would benefit if gas prices can bounce from historically low levels. Levered shale plays like Diamondback Energy (NASDAQ:FANG) are good choices for oil bulls, with OXY stock and Chesapeake Energy (NYSE:CHK) in the highest-risk, highest-reward bracket.EPD stock is not the right play for those theses. But it is a stock that can provide steady income well above bond yields, as long as U.S. energy production stays reasonably stable. That's an attractive thesis -- but not one that changes all that much if crude is at $90 or at $50.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Utility Stocks to Buy That Offer Juicy Dividends * 10 Gold and Silver Stocks to Profit Off 2020's Fear Trade * 3 Top Companies That Should Be More Careful With Your Data The post Enterprise Products Partners Stock Is For Income Investors, Not Oil Bulls appeared first on InvestorPlace.
Beleaguered oil and gas firm Chesapeake Energy (NYSE:CHK) is again generating headlines for the wrong reasons. Recently, a Reuters report revealed that the daughter of a worker who was tragically killed in an oil-well explosion sued Chesapeake and three other organizations, claiming in part an unsafe work environment. Although it won't kill CHK stock on its own, the lawsuit is a lowlight among several.Source: Casimiro PT / Shutterstock.com From the fundamentals to the financials to the front page, Chesapeake Energy screams disaster. This is an organization that is not racing against time but inevitability. Based on the company's instability as well as an unfavorable backdrop, CHK stock could very well go to zero.Initially, that might sound as if I'm contradicting my bullishness on equities. In contrast to the naysayers, I don't see the current bull market as overextended. If anything, we probably have a good ten years before we need to think about responding to an imminent correction.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAs my readers know, I'm a big believer in megatrends. These overwhelming catalysts will fuel what I call the Roaring 2020s. However, the opposite is also true: if a company is not aligned with these trends - or worse, positioned against them - it faces severe dangers. Such is the case with CHK stock. * 7 Utility Stocks to Buy That Offer Juicy Dividends Frankly, oil is a yesteryear energy source. During the era when vehicles ran exclusively on petroleum-based products, oil was an absolute necessity. Further, supply demand dynamics reflected this economic reality. But in the world of alternatives forwarded by Tesla (NASDAQ:TSLA), Nio (NYSE:NIO) and many others, oil is losing ground.That's not to say that oil is completely irrelevant as the transition will take time. But this leaves Chesapeake with no margin for error. CHK Stock Suffers as Oil Supply SoarsThe main problem with Chesapeake's recovery initiative is that they're dealing with "dumb" commodities. There's nothing special about them. Because of that, they're driven by supply and demand. With the introduction of viable alternatives, supply necessarily increases, depressing demand.Even if Chesapeake cleans up its own house, it can't do anything about the broader wave impacting its industry. Therefore, CHK stock is a losing bet.Tellingly, CHK has an inverse relationship with proven oil reserves in the U.S. When shares started trading in 1993, Chesapeake was in the midst of declining reserves. It was the go-go 1990s, with soaring crude oil demand pressuring inventory. This same trend developed throughout most of the 2000s decade.However, an interesting thing happened in 2008. As global investment indices crashed, so did oil reserves, hitting a multi-decade low of 19.1 billion barrels. According to data from the U.S. Energy Information Administration, such a level hasn't been seen since the beginning of World War II. Click to EnlargeSubsequently, CHK stock hit an annual average peak of just under $35 a pop. Since then, shares have never looked the same as oil reserves steadily climbed, first due to reduced demand and later through increased oil production and the introduction of hybrids, electric vehicles and other transportation alternatives.Between 1993 through 2008, annual oil reserves averaged 21.8 billion barrels. From 2009 through 2018, though, oil reserves spiked to 31.9 billion barrels, an over 46% increase in supply.Making matters worse for CHK stock, oil supplies accelerated starting from 2017. By the end of that year, reserves hit nearly 39.2 billion barrels, a then record. In 2018, reserves hit 43.8 billion barrels, shattering the previous year's tally.The trend is only getting worse, heaping exponential pressure on CHK stock. Waiting for the InevitableAbout the only thing that could have saved Chesapeake was a focus on financial stability. Commoditized names can still win. But when you're competing on price and not on product differentiation, you've got to have your fiscal house in order. Commoditization sometimes requires wars of attrition.However, Chesapeake nuked that chance when they decided to get acquisitive. To add insult to injury, management acquired WildHorse Resource Development. This is completely against my investment philosophy. Instead of banking on where the money will be, Chesapeake essentially banked on where it once was.The move didn't make any sense then and it certainly doesn't make any sense now. Sinking their financials by choice, the energy firm must depend on favorable underlying market conditions. But that's not happening as the megatrend is moving in the opposite direction.Ultimately, I see CHK stock as unreasonably risky. It neither benefits from corporate leadership nor from industry conditions. You're left depending on the emotions of the masses. That's a gamble I'm not willing to take.Matthew McCall left Wall Street to actually help investors -- by getting them into the world's biggest, most revolutionary trends BEFORE anyone else. The power of being "first" gave Matt's readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Utility Stocks to Buy That Offer Juicy Dividends * 10 Gold and Silver Stocks to Profit Off 2020's Fear Trade * 3 Top Companies That Should Be More Careful With Your Data The post CHK Stock Is on the Wrong End of a Megatrend appeared first on InvestorPlace.
Things may change, but barely more than a month into 2020, it's clear that traditional energy stocks are under immense pressure and that includes the already downtrodden Chesapeake Energy (NYSE:CHK). Even though CHK stock experienced a nice rally in December, it wasn't nearly enough to shake the stock out of what had become a lengthy slumber.Source: Casimiro PT / Shutterstock.com Moreover, the coronavirus outbreak has crippled energy commodities in the early innings of 2020, but even if that wasn't an issue to contend with, Chesapeake has headline risk of its own to contend with.At the end of last month, a Chesapeake well in Burleson County, Texas blew out, initially killing two workers. Unfortunately, a third has since been added to that list and while it's not immediately clear if he was a Chesapeake staffer, the incident occurred at one of the company's wells.InvestorPlace - Stock Market News, Stock Advice & Trading TipsSo barely more than a month into 2020, Chesapeake stock is down more than 38%, bringing its 12-month loss north of 81%. * 7 Utility Stocks to Buy That Offer Juicy Dividends Somehow, Chesapeake, which closed at 51 cents on Feb. 4, has yet to announce a reverse split. This seems to be an inevitability because it has been several months since Chesapeake closed above $1, indicating it's just a matter of time before the New York Stock Exchange tells the company it's in violation of the exchange's price requirements. Cheap for a ReasonEven if a reverse split is forthcoming, all that is an artificial price-inflating mechanism. It's certainly not an improvement for Chesapeake's challenging underlying fundamentals. As a Florida State study confirms, a reverse split is "a negative informational event." Other academic research confirms reverse splits rarely turn out well for investors.For the 1,600 reverse splits that occurred between 1965 and 2001, the split stocks lagged their peers by 15.6% in the first year, more than double in year two and a whopping 54% in the third year, Barron's reports, citing research by professors at Emory University and New York University.Looked at another way, Chesapeake stock can be reverse split to infinity, but that's not going to change the natural gas market. The U.S. continues producing natural gas and oil at record levels and, fortunately, there is a vibrant export market for crude and liquefied natural gas (LNG) because domestic consumption growth of those fuels is slowing.The Annual Energy Outlook 2020, recently published by the Energy Information Administration (EIA), confirms that the mix of domestic power sources is increasingly diverse and increasingly open to renewables, such as solar and wind.Costs for renewables are declining, making those alternatives more compelling for environmentally-conscious power providers and consumers. As EIA notes, the high cost case for renewables is essentially out the wind and as a share of the broader energy mix, fossil fuels will gradually decline over the next three decades.These are the type of seismic shifts that can spell doom for some industries or, at the very least, some companies in those industries. So it's not a stretch to say that Chesapeake is trying to recover at the wrong place at the wrong time because it's trying to rehabilitate itself with a product (natural gas) for which users are embracing alternatives. Bottom Line on CHK StockI'm not saying Chesapeake is going to file for bankruptcy protection or disappear over the near-term, but I'll say this: if market observers are worried about Exxon Mobil's (NYSE:XOM) ability to generate cash, I wouldn't want any part of a significantly flimsier energy name.Chesapeake may be worth a glance for active traders that can make decent profits on small moves and have the time to monitor positions. If you're a long-term investor looking for value in the energy patch, look elsewhere or just consider renewables.As of this writing, Todd Shriber did not own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Utility Stocks to Buy That Offer Juicy Dividends * 10 Gold and Silver Stocks to Profit Off 2020's Fear Trade * 3 Top Companies That Should Be More Careful With Your Data The post There Really Is Nothing to Prevent CHK Stock from Trending Lower appeared first on InvestorPlace.
At least two federal agencies are investigating an oil well fire that killed three workers last week and put a fourth in the hospital. Investigators for the Occupational Safety and Health Administration and the Chemical Safety Board were in Burleson County Monday at the site of a blowout that occurred Jan. 29. OSHA first appeared on site Sunday, and CSB is completing its on-site investigation Tuesday, according to documents provided to the Business Journal by the Railroad Commission of Texas, which is also investigating the incident.
A third person has died following a blast this week at a Chesapeake Energy Corp well site in Burleson County, Texas, according to a local media report. Brian Maldonado, 25, of San Diego, Texas, succumbed on Saturday morning to injuries he suffered during Wednesday's blast, the Alice Echo News Journal reported, citing family and friends. Attempts by Reuters to reach Maldonado's relatives were not immediately successful.
Employees of Alice, Texas-based Forbes Energy Services were among those working at a Chesapeake Energy well in Texas that exploded this week, killing one person and injuring three others, the state's oil and gas regulator said on Friday. Employees of Chesapeake Energy, Eagle Pressure Control and CC Forbes, a unit of Forbes Energy Services, were at the site when the blast occurred, according to a Texas Railroad Commission report. Chesapeake and Eagle Pressure Control did not immediately respond to requests for comments, and Forbes did not respond to phone calls or emails seeking comment.
Normally, investors are encouraged to "think like an investor, not a customer" when considering whether to buy a stock. The thinking is that no matter how much we like a product, fundamentals matter.Source: Casimiro PT / Shutterstock.com In the case of Chesapeake Energy (NYSE:CHK), I want to encourage any remaining bulls to do something different. Rather than thinking like an investor or a customer, I want them to think like an employee. Then decide if CHK stock is something that you want to invest in. The Price of LoyaltyAbout 15 years ago, I got a lesson that took me years to recover from. It taught me that loyalty has its price. I was working for a marketing firm that grew its revenue about five times in just over a year. We hired literally dozens of full- and part-time workers. There was a large investment in infrastructure. We moved into a new building. Bonuses rivaled a big city advertising agency. These were heady times. But as I look back on it, there was something a little unsettling about it.InvestorPlace - Stock Market News, Stock Advice & Trading TipsOur business was growing due to a contract with a then-Fortune 500 company. The problem was the company was terminally ill. It was beginning to show more than a few signs of the problems that would drag its stock down to the penny stock level it is at today. * 7 Under-the-Radar European Stocks to Buy for 2020 But the real concern was that our contract was based on a dying business model. It would be similar to betting your business on printing newspapers today.Needless to say, when outsourcing became a more cost-effective alternative, the company went in another direction. In one day, our business lost about 75% of its revenue. Dozens of employees were let go. Infrastructure was sold. It was an awful time.Yet here I was, in the "other" business unit. The good news was we didn't rely on the other unit's revenue. The bad news was, we no longer benefitted from the other unit's revenue. That left us with our own business unit that had one primary client and not much else.And when the business finally (almost mercifully) dissolved a few years later, I was left to question if I would do it all over again. I wouldn't. Chesapeake Has a Dying Business ModelThe parallel I'm trying to draw is not that the U.S. is suddenly going to stop using traditional carbon fuels. Those energy sources are going to be needed to build out a new energy infrastructure.But Chesapeake Energy rose to prominence due to fracking. It was a controversial process that was in the regulatory crosshairs from the jump. But what made fracking riskier than in my example was that Chesapeake was using debt to finance its unconventional drilling process.Oil drilling is a risk in the best of circumstances. Adding the overlay of a process that went away almost overnight when the Obama administration came to power and you have a company with a massive debt problem.And the real problem is, there's no easy or even likely way for Chesapeake to get out of the mess they're in. Don't Bet on CHK StockI'm not telling any of you anything that you don't know. And if you read InvestorPlace, our writers have said the same thing. You have a company that has one option (sustained oil and gas prices) that seems like a fairy tale. A less bad option of selling assets to pay down debt that would buy it time…for what? Or, it could go into bankruptcy.It seems like an open and shut case to me. But in case you're thinking of executing a trade, I just ask you to think of yourself as a Chesapeake employee. Would you be betting your future on growth? Will the company attract the best and the brightest?In my case, I could see the writing on the wall. But I stayed because it felt wrong to abandon the ship when my experience could be valuable. I was wrong.I imagine Chesapeake Energy employees have been asking the same questions. And if employees don't have faith in the company, why should you invest in it?As of this writing Chris Markoch did not have a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Under-the-Radar European Stocks to Buy for 2020 * 7 Industries Using AI to Benefit Shareholders Around the World * 5 Chinese Stocks to Buy When Coronavirus Fears Fade The post Chesapeake Energy Bulls Are Asking the Wrong Question appeared first on InvestorPlace.
It's dark days for oil right now, and Chesapeake Energy (NYSE:CHK) is no exception. CHK stock just broke to new lows, hitting 51 cents per share. With all sorts of quality energy and oil stocks under pressure, even "cheap" can't make a case for this name right now.Source: Casimiro PT / Shutterstock.com As if trading for about 50 cents a shares weren't enough confirmation, CHK stock is down 80% over the past 12 months. It's been a tough run and it highlights how dangerous it can be to hold onto stocks that are in a clear downtrend. There's good reason that they say stop-losses save lives and Chesapeake highlights why. Trading CHK StockIn September, it looked like CHK stock could actually get out of its funk. Shares were rallying off the $1.25 level, reclaiming $2 and pushing through its major moving averages. When that move ultimately failed though, it set the tone for what was to come.InvestorPlace - Stock Market News, Stock Advice & Trading TipsSource: Chart courtesy of StockCharts.comBy November, shares burst below $1.25 support, crashing from a high of $1.59 to a 55-cent low in just a few weeks. As CHK stock rallied with the rest of the market in December, a very decisive stand took place: Chesapeake stock could not reclaim the $1 mark. It tried twice, topping at 98 cents and 96 cents, respectively. * 10 Stocks to Buy for Your Income-Generating Portfolio So far in 2020, CHK stock has continued to struggle. Shares are down six straight sessions to new lows and are lower in 11 of the past 13 sessions.Could Chesapeake shares reclaim the 55-cent low they just broke and rally to the declining 20-day and 50-day moving averages? Sure, and that'd be good for a 25-30% rally from current levels. Could it go even further, up to downtrend resistance (blue line), good for a 40%-plus move? Certainly.But just because it has the potential to play out doesn't mean it's a worthwhile investment. All Oil is Under PressureRight now, the entire oil space is under pressure. Energy stocks continue to push lower and even the strongest companies are struggling to advance their stocks. Just look at Exxon Mobil (NYSE:XOM), which is flirting with a move to its lowest level since 2010.This is not a time to have weak financials.The problem for Chesapeake? It's not making money while the income statement is shrinking instead of growing. Analysts expect a loss of 25 cents per share for fiscal 2019 as revenue sinks 14% to $8.8 billion. That's down big from the 90 cents per share in profit from the prior year. In 2020, estimates call for sales to fall another 8%, while losses expand to 30 cents per share.The income statement isn't inspiring, but the balance sheet is the most troubling. Current liabilities of $2.34 billion are significantly more than current assets of $1.4 billion. This suggests that CHK stock may have trouble meeting its short-term obligations.Total assets of $16.57 billion do outweigh total liabilities of $11.84 billion, but there is still dire concern about Chesapeake making good on its obligations. If that weren't the case, shares wouldn't trade for under a buck.That's where lacking profitability and a free cash flow deficit really sap confidence. Alternatives to ChesapeakeIf not CHK stock, then what? To be a buyer in the energy space, it first helps to be bullish on energy! The technicals surely don't say that's the case, but the truth is, we'll be dependent on oil and natural gas for quite some time. * 7 Biometrics Stocks That Will Help Shape the Next Decade Investors who then feel compelled to be a buyer of the space, may look to some of the long-lasting companies in the sector. There's always the Energy Select Sector SPDR Fund (NYSEARCA:XLE) or the VanEck Vectors Oil Services ETF (NYSEARCA:OIH) that offer a diversified approach.There's also long-time stalwarts like the aforementioned Exxon or Chevron (NYSE:CVX). Although neither is flourishing at the moment, they will be around 10 and 20 years from now.Others that have more flexibility, great assets and solid businesses include EOG Resources (NYSE:EOG), Pioneer Natural Resources (NYSE:PXD) and Concho Resources (NYSE:CXO).Some may prefer to average down as these out-of-favor stocks sink lower. Others may prefer to wait until the technicals start to show signs of bullish momentum. As long as you have a plan, do what works best for you.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Under-the-Radar European Stocks to Buy for 2020 * 7 Industries Using AI to Benefit Shareholders Around the World * 5 Chinese Stocks to Buy When Coronavirus Fears Fade The post Even This Cheap, It's Hard to Make a Case for Chesapeake Energy Stock appeared first on InvestorPlace.
Authorities on Thursday were investigating a fire at a Chesapeake Energy Corp oil well in Texas that killed one worker and injured three others. Emergency teams were working to contain a blowout that triggered Wednesday's blaze at a remote site near Deanville, Texas, about 75 miles (121 km) east of Austin, a representative for the Burleson County Sheriff's Office said. The U.S. Occupational Safety and Health Administration, which investigates worksite fatalities, said on Thursday it had opened an investigation.
Shares of Chesapeake Energy Corp. soared 8.3% in premarket trading Wednesday, to bounce off the previous session's 26-year low, after the oil and gas company provided a preliminary fourth-quarter production update. The stock is on track to snap a 7-session losing streak in which it tumbled 24.9%. The company said its average estimated equivalent production of 476,000 to 478,000 barrels of oil equivalent (boe) per day, up from average daily production of 464,000 boe, but below the FactSet consensus of 484,300 boe. The average estimated oil production range is 125,000 to 126,000 barrels of oil per day. Chesapeake said it eliminated $900 million in debt, reduced expenses for gathering, processing, transportation and other general expenses by over $335 million and that it had $1.4 billion of liquidity available as of Dec. 31. "Our strong results in the fourth quarter have continued into early 2020 and are setting the foundation for the company to reach free cash flow this year," said Chief Executive Doug Lawler. The stock, which closed Wednesday at 51.82 cents, the lowest level since January 1994, has plunged 64.8% over the past three months through Tuesday, while the SPDR Energy Select Sector ETF has slipped 6.9% and the S&P 500 has rallied 7.9%.
Fracking giant Chesapeake may seem a bargain right now, but with natural gas prices plunging below $2, the company could collapse under its heavy debt load
Shares of Chesapeake Energy Corp. fell 1.7% toward a 26-year low in active morning trading Monday, amid worries that the rapidly spreading deadly coronavirus would weaken demand for crude oil. The oil and gas company's stock was on track for the lowest close since April 1994, as continuous crude oil futures dropped 1.8% toward a 3 1/2-month low. Chesapeake Energy's stock has now plunged 64.8% over the past three months, while crude futures has lost 6.0%, the SPDR Energy Select Sector ETF has declined 6.9% and the S&P 500 has gained 7.5%.
Once an iconic industrial giant, few companies have suffered as ignominious a loss as General Electric (NYSE:GE). In fact, the GE stock price peaked in the 2000s era dot-com bubble, never threatening to regain its former glory. But with shares turning in a tremendous performance in 2019, can this beleaguered organization do the impossible and recover?Source: JPstock / Shutterstock.com Obviously, I can appreciate the healthy skepticism that abounds with this name. Not only did GE stock peak roughly 20 years ago, it plummeted following a sizable rally leading up to the 2008 financial crisis. Shares again crashed in 2017 after the company's fiscal situation became untenable.Plus, there's the adage: if shares are cheap, there's usually a reason for it. With GE stock, you're taking a big risk that management can pull off a perhaps unprecedented recovery.InvestorPlace - Stock Market News, Stock Advice & Trading TipsTo be fair, the business leader that has the potential to do this is current CEO Larry Culp. An executive with a long history of accomplishments, he grew the market capitalization of his previous employer Danaher (NYSE:DHR) to $50 billion from $9.7 billion during his 14-year tenure. * 9 Up-and-Coming Small-Cap Stocks to Watch That said, Culp transformed a solid company to a great one in Danaher. But with General Electric, the wall that he must climb is in a different dimension. To draw a comparison, GE stock is the Chesapeake Energy (NYSE:CHK) of the industrial sector in that excellent leadership is not enough: GE requires other factors to shift favorably to see the recovery through.Can it happen? It's not an opportunity for risk-averse investors. However, if you want to take a small, measured gamble, here are three elements to consider: GE Stock May Enjoy a Geopolitical TailwindGeneral Electric's long-term stakeholders are undoubtedly familiar with the saying, "when it rains, it pours." That was evident when Boeing (NYSE:BA) suffered a serious crisis with its 737 Max 8 jetliner. Due to a faulty stabilization mechanism, government agencies throughout the world grounded the plane until Boeing got their act together.As luck would have it, General Electric is the manufacturer of the Max 8's engine. Moreover, the company's aviation division was one of the few bright spots. Without it, the nearly impossible becomes simply the impossible. Naturally, then, investors avoided GE stock like the plague.However, the 737 Max 8 crisis won't last forever. Once Boeing earns back its customers' trust, General Electric can then get back to business.Also, GE's fortune may have finally turned regarding outside tailwinds. Presently, the headlines are not focused on Boeing, but rather, tensions between the U.S. and Iran. With the possibility that the conflict could eventually turn hot, GE's military aviation unit may enjoy a sizable lift. Power Is Still RelevantOne of the conspicuous societal shifts that we've witnessed over the years is environmentalism. Concerns about sustainability have dominated the headlines last year. And one of the forwarded solutions is to promote clean energy initiatives.Last month, the Los Angeles Department of Water and Power announced their intention to convert one of their power plants to 100% hydrogen by 2045. To do this, the utility firm will integrate a variety of renewable energy platforms to produce hydrogen via electrolysis. Currently, technological barriers prevent meeting the 100% hydrogen goal earlier.But according to Harvard researchers Lee M. Miller and David Keith, that might not come to fruition. Based on their analysis, the U.S. is grossly underestimating the land requirements for going fully green. As an example, if the entire country were to be powered via renewable energy sources, "it could require one-third of the country be covered by renewable solar and wind energy facilities."In other words, General Electric's power unit is still relevant. It's just taking some time for influential people and organizations to realize this. Technicals Are CompellingWe all know that GE stock is cheap. And as I mentioned above, such discounts exist for typically unpleasant reasons.However, the opposite angle is that shares have jumped substantially from its late 2018 lows. While hiccups have presented themselves along the way, the equity has marched steadily higher. Thus, there's a reason for that too.At time of writing, GE stock is trading just under $12. That places shares at the support line just prior to its October 2018 crash. To put it another way, GE is at a crossroads.For conservative investors, it's safer to assume that shares have again hit a peak. Culp can work wonders but General Electric requires a miracle. But for speculators, there might be enough momentum (at least in the nearer term) to spark a significant lift.As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 9 Up-and-Coming Small-Cap Stocks to Watch * 7 Energy Stocks to Buy on the Resurgence of the Oil Boom * 3 Standout Oil Services Stocks to Buy The post 3 Factors to Consider Before Gambling on GE Stock appeared first on InvestorPlace.