Has anyone heard the rumor that CHK is being broken up and sold? Could be why they are holding up division orders on wells now producing for 4 to 6 months or more. Could be they want to hold onto the money they would have paid for royalties longer so the company looks more viable.
Every time they sell off leases they take a hit to earnings book value. Why buy the whole company when you can get assets on the cheap? 12-18 months the stock will be below $16. Only thing that will "bail them out" is Nat. Gas above $5.
Maybe winter will bring the price of NG up to $5. Just wondering how long they can hold off paying royalties or is 6 months the norm?
CHK has been a takeover target for three years now. It would take a pretty dedicated buyer to do the due diligence on a company that has so many entanglements, JVs, etc. EPS is -$2.18, which is not attractive when you look at GPOR who's at $1.58. Forecasts for P/E drop from 2013 to 2014. Growth is expected to drop from 173% 2013 to 25% in 2014. Not a sign of value. Nothing justifies a $40 price target except for $5+ NG prices, in which case every E&P company would raise their targets. CHK has had a nice run up but it's still well below the level that I sold it at 3 1/2 years ago, which says something.