In the latest trading session, Chesapeake Energy (CHK) closed at $87, marking a -1.26% move from the previous day. This change was narrower than the S&P 500’s daily loss of 1.57%. Meanwhile, the Dow lost 1.56%, and the Nasdaq, a tech-heavy index, added 0.1%.
Heading into today, shares of the oil and gas company had gained 11.01% over the past month, outpacing the Oils-Energy sector’s gain of 9.41% and the S&P 500’s gain of 5.37% in that time.
Chesapeake Energy will be looking to display strength as it nears its next earnings release.
Any recent changes to analyst estimates for Chesapeake Energy should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 13.48% higher. Chesapeake Energy is currently a Zacks Rank #1 (Strong Buy).
Looking at its valuation, Chesapeake Energy is holding a Forward P/E ratio of 8.05. This valuation marks a discount compared to its industry’s average Forward P/E of 16.33.
It is also worth noting that CHK currently has a PEG ratio of 1.28. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Alternative Energy – Other industry currently had an average PEG ratio of 1.69 as of yesterday’s close.
The Alternative Energy – Other industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 162, putting it in the bottom 37% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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