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Chesapeake Energy (CHK) Dips More Than Broader Markets: What You Should Know

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Chesapeake Energy (CHK) closed at $87.01 in the latest trading session, marking a -1.84% move from the prior day. This change lagged the S&P 500's 0.07% loss on the day. Meanwhile, the Dow gained 0.27%, and the Nasdaq, a tech-heavy index, added 0.02%.

Coming into today, shares of the oil and gas company had lost 8.98% in the past month. In that same time, the Oils-Energy sector lost 11.91%, while the S&P 500 lost 7.99%.

Wall Street will be looking for positivity from Chesapeake Energy as it approaches its next earnings report date. On that day, Chesapeake Energy is projected to report earnings of $3.17 per share, which would represent year-over-year growth of 93.29%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.57 billion, up 126.56% from the year-ago period.

Investors should also note any recent changes to analyst estimates for Chesapeake Energy. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.44% lower. Chesapeake Energy is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Chesapeake Energy is currently trading at a Forward P/E ratio of 6.56. Its industry sports an average Forward P/E of 4.71, so we one might conclude that Chesapeake Energy is trading at a premium comparatively.

It is also worth noting that CHK currently has a PEG ratio of 1.05. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Oil and Gas - Exploration and Production - United States stocks are, on average, holding a PEG ratio of 0.23 based on yesterday's closing prices.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 39, putting it in the top 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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