Chesapeake Energy Corporation (NYSE:CHK) announced the expiration and final results of its offers to purchase for cash (the “Tender Offers”) up to $750,000,000 aggregate purchase price (exclusive of accrued interest) (the “Aggregate Maximum Purchase Amount”), of the outstanding notes of Chesapeake set forth in the table below (collectively, the “Notes”). As of 11:59 p.m., New York City time, on September 12, 2016 (such date and time, the “Expiration Date”), Chesapeake received valid tenders totaling approximately $790.4 million aggregate principal amount of the Notes.
Chesapeake is accepting for purchase (i) $600.0 million aggregate principal amount of the 2.5% Contingent Convertible Senior Notes due 2037 (the “2037 Notes”) validly tendered and not validly withdrawn for an aggregate consideration of approximately $600.0 million, excluding accrued and unpaid interest, and (ii) all of the 2.25% Contingent Convertible Senior Notes due 2038 (the “2038 Notes”) validly tendered and not validly withdrawn for an aggregate consideration of approximately $99.3 million, excluding accrued and unpaid interest. Because the purchase of all of the 2037 Notes validly tendered and not validly withdrawn results in an aggregate purchase price that exceeds the 2037 Tender Cap, the amount of 2037 Notes purchased will be prorated as described in the Offer to Purchase. Chesapeake expects to make payment for the Notes accepted for purchase in same-day funds on September 14, 2016.
Shares of Chesapeake Energy are currently trading at $7.40, down nearly 8%. CHK has a 1-year high of $9.55 and a 1-year low of $1.50. The stock’s 50-day moving average is $5.90 and its 200-day moving average is $4.95.
On the ratings front, Chesapeake has been the subject of a number of recent research reports. In a report released yesterday, Suntrust Robinson Humphrey analyst Neal Dingmann maintained a Buy rating on CHK, with a price target of $11, which represents a potential upside of 36.6% from where the stock is currently trading. Separately, on September 9, Wunderlich Securities’ Jason Wangler upgraded the stock to Buy and has a price target of $10.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Neal Dingmann and Jason Wangler have a total average return of -9.6% and -11.9% respectively. Dingmann has a success rate of 39.5% and is ranked #3888 out of 4143 analysts, while Wangler has a success rate of 34% and is ranked #3992.
The street is mostly Neutral on CHK stock. Out of 14 analysts who cover the stock, 6 suggest a Hold rating , 4 suggest a Sell and 4 recommend to Buy the stock. The 12-month average price target assigned to the stock is $4.75, which implies a downside of 41.0% from current levels.
Chesapeake Energy Corp. engages as a natural gas and oil exploration and production company. It operates through the Exploration and Production; Marketing, Gathering and Compression segments. The Exploration and Production segment focuses on finding and producing natural gas, oil and natural gas liquids. The Marketing, Gathering, and Compression segment deals with the marketing, gathering, and compression of natural gas, oil, and natural gas liquids primarily from Chesapeake-operated wells.