![]() (To watch Hanold’s track record, click here) Buy), while setting a price target of $110 to indicate his confidence in a 33% upside potential for the coming year. Hanold goes on to rate CHK shares as an Outperform (i.e. The pacing of buybacks appear more ratable and amount to around 8% of the market cap through YE23.” There is flexibility to taper more budgeted activity if the natural gas macro remains weak, which we don’t anticipate at this time. CHK plans to remain flexible with its natural gas directed drilling program that currently contemplates activity reductions over the next few months. In his comments on the stock, Hanold writes, “There are several potential catalysts over the coming quarters including increased buybacks, improving natural gas prices, and a sale of its remaining Eagle Ford asset. Chesapeake’s dividend payment made up a significant portion of the $250 million-plus the company returned to shareholders during the first quarter.Ĭhecking in with RBC’s Scott Hanold, we find that the analyst points to the company’s ability to maintain capital return as a key point for investors. ![]() The annualized rate of $4.72 gives a yield of 5.75%. Chesapeake’s last payment was sent out on June 6, at $1.18 per common share. These latter two metrics are of particular interest to dividend-minded investors, as cash flow typically supports the dividend payment. In addition to its earnings beat, Chesapeake also generated $889 million in net cash from operations, and $241 million in adjusted free cash flow. This EPS figure beat the forecasts by 18 cents. Chesapeake retains about 50,000 net acres focused in the ‘Rich Gas’ portion of this Texas play.Īltogether, these assets generated a total of 4.1 bcfe/d in 1Q23, and brought the company an adjusted net income of $270 million, or $1.87 per share by non-GAAP measures. The Eagle Ford assets are Chesapeake’s smallest, after the company sold off $2.8 billion worth of land holdings in the first quarter of this year. In the Haynesville formation, the company holds 370,000 net acres and produces 1.55 bcfe/d. The Marcellus holding is Chesapeake’s largest, at approximately 465,000 net acres and production of 1.97 billion cubic feet equivalent per day. The company specializes in horizontal drilling and hydraulic fracturing, while implementing proven environmental protective measures to protect aquifers and other natural resources. We’ll start with Chesapeake Energy, an oil and gas production firm founded in 1989 and operating today in three high-output shale formations: the Eagle Ford of south Texas, the Haynesville of northwestern Louisiana, and the Marcellus shale of northeastern Pennsylvania. These strong dividend payers offer the protection of a steady income stream even through a downturn. ![]() RBC’s 5-star analyst Scott Hanold is following Calvasina’s lead, recommending two high-yielding energy dividend stocks, including one that yields around 8%. Energy has a high dividend yield relative to other sectors and versus its history, and energy companies have been active in buying back stock.” One of those paths isn’t automatically more likely than the other… We recommend a balance: some defensive stocks, some value, and some growth… also like energy stocks. Looking at the situation from RBC Capital, Lori Calvasina writes, “There are two ways it can go from here: Something could go wrong with those winning companies and pull the market down, or the market’s leadership could broaden out. However, the conventional wisdom says that we’re looking at a recession, likely short and shallow, to play out during the second half of this year, with a chance of extending into 1Q24. ![]() Currently, the markets are experiencing a bullish trend.
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