0.6625 -0.01 (-1.18%)
After hours: 4:36PM EDT
|Bid||0.6617 x 4000|
|Ask||0.6726 x 46000|
|Day's Range||0.6500 - 0.7101|
|52 Week Range||0.6200 - 30.9400|
|Beta (5Y Monthly)||3.70|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
Given the oil price freefall, Whiting Petroleum (WLL) instantly lowers its development activity and plans to keep a low profile until a sharp recovery is achieved in commodity price.
(Bloomberg) -- Tumbling oil prices around the world are shining a light on the U.S. shale producers that are most at risk because of heavy debt loads.“I wouldn’t be surprised to see 55 to 60 bankruptcies” this year, compared with 50 last year, said Raoul Nowitz, managing director of restructuring and distressed asset support services at SOLIC Capital. That number may grow if the price slump persists for an extended period, he said.Chesapeake Energy Corp.Once a titan in shale, Chesapeake was spiraling downward even long before Monday’s market rout after it and rival drillers flooded North America with excess gas. Chief Executive Officer Doug Lawler recently told investors the survival strategy for his company includes selling assets, even though the acquisition market already is glutted with gas holdings.Read More: Oil-Price Collapse Seen Battering U.S. Investment, EmploymentChesapeake’s push to transition into an oil producer could prove pointless now that oil has dropped more than gas year to date. The company bought time in December by swapping some debt but it still has $192 million of bonds coming due in August, out of a total debt load of more than $9 billion.Unit Corp.Heightened refinancing and liquidity risks led Fitch Ratings to downgrade Unit Corp. in January because of the Tulsa, Oklahoma-based explorer’s “prolonged operational deterioration” since a bond exchange announcement that same month.The company, which generates most of its output from gas, announced last month that CEO Larry Pinkston will retire at the end of March and will be replaced by Chief Operating Officer David Merrill.Ultra PetroleumThe Colorado driller disclosed last week that it held talks with holders of its long-term debt in an effort to reduce leverage. That came after Ultra Petroleum Corp. said in November it had hired the Houston boutique energy bank Tudor, Pickering, Holt & Co. to evaluate strategic alternatives that would include the possibility of a corporate sale, merger or other transactions.Ultra filed for bankruptcy in 2016 and emerged the following year, just as the shale patch was beginning to crawl out of what was then the worst crash in a generation. The company’s bank recently cut Ultra’s credit line and borrowing base. Ultra shares have fallen 85% in the past year and traded for 8.5 cents on Monday.California Resources Corp.While California Resources announced last month an exchange offer for some of its bonds that could reduce total debt by $1 billion and extend the maturity of another $700 million by six years, the collapse in oil prices may make lenders balk at extending more credit to the state’s largest oil producer.The company may require Brent futures, the global crude benchmark, to be higher than $65 to generate free cash flow while maintaining output, Spencer Cutter and Leon Huang, analysts at Bloomberg Intelligence, wrote last month in a report.Whiting PetroleumAn oil explorer focused on the Bakken Shale in North Dakota, Whiting Petroleum Corp. has faced headwinds as low crude prices squeeze profits. The company announced last year that it would fire one-third of its workforce and scale back production targets after posting a surprise quarterly loss.Whiting has about $1 billion of debt coming due over the next year, including about $260 million of convertible notes that mature in April. It’s working with advisers to come up with strategic options, but investors have their doubts: its notes due March 2021 are trading around 18 cents on the dollar with a yield of 286%, which suggests they will never be repaid. Shares have lost 89% of their value so far this year.To contact the reporters on this story: David Wethe in Houston at email@example.com;Allison McNeely in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Simon Casey at email@example.com, Joe Carroll, Christine BuurmaFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- It’s often said that inflation is the bogeyman for bond traders. Indeed, accelerating price growth diminishes the value of each fixed interest payment over the years. Investors would be better off buying assets that increase along with prices, like real estate or equities, in theory.This week, bond traders are learning that the prospect of deflation can be just as painful.The benchmark 10-year U.S. Treasury yield tumbled by as much as 45 basis points on Monday to as low as 0.3137%. That’s more than 100 basis points below the record level of 1.318% that stood as recently as last month. Sure, anyone who owned U.S. Treasuries heading into 2020 has benefited from the incredible rally. But it leaves future investors with a grim reality of rock-bottom returns, putting the U.S. closer than ever to the likes of Germany and Japan. Last week, investors flocked to Treasuries purely as a way to protect against a swift slowdown in global economic growth because of the coronavirus outbreak. This week it’s something more. The price of oil crashed more than 30% after Saudi Arabia declared a price war and the OPEC+ alliance shattered. So too did break-even rates, which are the bond market’s measure of inflation expectations. The 10-year rate collapsed more than 30 basis points, the steepest decline since November 20, 2008, to about 1 percentage point, the lowest since March 2009. The five-year rate is 0.8 percentage point and the two-year rate is less than 0.5 percentage point.That’s bad news for the Federal Reserve, which is desperate to get inflation consistently at or above its 2% target after years of failing to do so. While oil prices are historically volatile, a shock of this magnitude can’t be dismissed by simply focusing on the “core” measures that exclude energy and food prices. It will reverberate through Main Street and Wall Street alike.The sharp drop in oil prices is even worse news for credit markets. The Markit CDX North America High Yield Index, which tracks the cost of insuring against defaults, surged on Monday by 145 basis points, the largest increase ever in data going back to 2012. It’s within striking distance of the highest level on record. The investment-grade fear gauge jumped by the most since Lehman Brothers crumbled.More specifically, significantly lower oil prices have immediate consequences for speculative-grade energy companies. At the end of last week, their yield spread widened to 1,080 basis points, up from just 612 basis points in January. It’s only going to get worse, and the spread could soon reach a record high, judging by recent trading. A Chesapeake Energy Corp. bond maturing in 2025 with an 11.5% coupon came into 2020 at a price just below 100 cents on the dollar. The same security, with a composite credit rating of triple-C, traded at 27 cents on the dollar on Monday.Investors are even losing confidence that some companies will survive the next year or two. Antero Resources Corp. debt due in November 2021 plunged 37 cents on Monday to 46.5 cents, while Whiting Petroleum Corp. securities maturing in March 2021 fell 25 cents to a mere 20 cents. There will be bankruptcies and defaults, full stop. The most scary prospect for bond traders is that this deflationary spiral ensnares other parts of the credit markets that are leveraged to the brim. It’s no secret, for instance, that the universe of triple-B rated corporate bonds has expanded to more than $3 trillion from $800 billion at the end of the last recession. Borrowing costs have remained historically low in the post-crisis era, creating the incentive for blue-chip companies and risky upstarts alike to finance themselves through debt. Carrying a vulnerable balance sheet can work when inflation is low but steady along with economic growth and when the credit markets are wide open for business. It’s an open question whether any of those assumptions still hold.Bond traders expect the Fed will do what it can, up to and including cutting its key short-term rate all the way back to the lower bound of 0% to 0.25% in short order. Such a move, in theory, would spur inflation. I’m skeptical, judging by the years of stagnant price growth in Europe and Japan. So too, apparently, are the European Central Bank and the Bank of Japan. There’s a reason that neither one is in a rush to drop interest rates further into negative territory. As Lacy Hunt of Hoisington Investment Management told me last week, “when the short rates start coming down toward zero, even before they get to zero, you reach a reversal point and the counterproductive effects of the lower rates offset the beneficial effects of having a lower cost of borrowing.” Banks are one such industry feeling the pinch. They struggled enough with short-term rates near the zero bound and longer-term yields around 2%. How are they supposed to earn net interest income now, with the 10-year yield at 0.5%? Investors aren’t waiting to find out: The KBW Bank Index plunged about 10% on Monday.With the coronavirus outbreak, there was always the feeling that maybe it wouldn’t be as bad as the worst-case scenario. The plunge in oil prices appears to have more staying power. Whether that one-two punch brings about outright deflation remains to be seen. But it’s looking more likely than any point in the past decade, which is an ominous sign for bond markets of all stripes. Flocking to the haven of Treasuries provides almost no income. The reach-for-yield trade is quickly unraveling in the riskiest debt. One of the cornerstones of the longest expansion in U.S. history — a benign corporate default rate — no longer looks so sturdy.The bond markets have cracked. Any further move toward deflation would most likely create a chasm.To contact the author of this story: Brian Chappatta at firstname.lastname@example.orgTo contact the editor responsible for this story: Daniel Niemi at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Whiting Petroleum's (WLL) discretionary cash flow of $188.7 million surpasses its capex worth $103 million, accounting for a positive free cash flow of $86 million.
Whiting (WLL) delivered earnings and revenue surprises of 50.00% and 1.23%, respectively, for the quarter ended December 2019. Do the numbers hold clues to what lies ahead for the stock?
Whiting (WLL) 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.
Investors need to pay close attention to Whiting Petroleum (WLL) stock based on the movements in the options market lately.
In this article we are going to estimate the intrinsic value of Whiting Petroleum Corporation (NYSE:WLL) by estimating...
Even as uncertainties flare over when at how Iran will retaliate after a U.S. airstrike took out one of its top Iranian military commanders, markets have taken hold of two grounding principles, according to Mohamed El-Erian.
Canada’s long-suffering energy sector likely isn’t in position to take advantage if supply drops in the Middle East, analysts say.
Oil prices spiked in the immediate aftermath of the Department of Defense’s confirmation of an airstrike that killed a top Iranian military commander.
Whiting's (WLL) Q3 results offer something positive despite a bleak scenario to raise long-term investors' hopes on the stock as total operating expenses decline 11.6% from the prior-year level.
Investors need to pay close attention to Whiting Petroleum (WLL) stock based on the movements in the options market lately.
Cowen Senior Analyst Gabriel Daoud joins On The Move to discuss the firm’s decision to downgrade multiple oil and gas companies following OPEC's failure to strike a deal on production cuts.