CHESAPEAKE ENERGY CORP (CHK) Stock Fundamental Analysis
NASDAQ:CHK - Nasdaq - US1651677353 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to CHK. CHK was compared to 209 industry peers in the Oil, Gas & Consumable Fuels industry. While CHK has a great health rating, its profitability is only average at the moment. CHK is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year CHK was profitable.
CHK had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: CHK reported negative net income in multiple years.
In the past 5 years CHK always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.22%, CHK is doing worse than 65.07% of the companies in the same industry.
CHK has a worse Return On Equity (4.22%) than 70.33% of its industry peers.
The Return On Invested Capital of CHK (2.57%) is worse than 75.60% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CHK is significantly below the industry average of 27.48%.
The last Return On Invested Capital (2.57%) for CHK is well below the 3 year average (13.76%), which needs to be investigated, but indicates that CHK had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.22% | ||
| ROE | 4.22% | ||
| ROIC | 2.57% |
ROA(3y)35.26%
ROA(5y)-8.99%
ROE(3y)62.5%
ROE(5y)N/A
ROIC(3y)13.76%
ROIC(5y)9.96%
1.3 Margins
CHK has a Profit Margin (8.94%) which is in line with its industry peers.
In the last couple of years the Profit Margin of CHK has grown nicely.
With a Operating Margin value of 8.56%, CHK is not doing good in the industry: 69.86% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of CHK has grown nicely.
CHK's Gross Margin of 78.39% is amongst the best of the industry. CHK outperforms 88.52% of its industry peers.
CHK's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.56% | ||
| PM (TTM) | 8.94% | ||
| GM | 78.39% |
OM growth 3Y60.28%
OM growth 5Y26.63%
PM growth 3YN/A
PM growth 5Y88.94%
GM growth 3Y5.78%
GM growth 5Y0.58%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CHK is still creating some value.
The number of shares outstanding for CHK has been reduced compared to 1 year ago.
The number of shares outstanding for CHK has been increased compared to 5 years ago.
The debt/assets ratio for CHK has been reduced compared to a year ago.
2.2 Solvency
CHK has an Altman-Z score of 4.46. This indicates that CHK is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of CHK (4.46) is better than 85.17% of its industry peers.
CHK has a debt to FCF ratio of 9.53. This is a negative value and a sign of low solvency as CHK would need 9.53 years to pay back of all of its debts.
With a Debt to FCF ratio value of 9.53, CHK perfoms like the industry average, outperforming 43.06% of the companies in the same industry.
A Debt/Equity ratio of 0.19 indicates that CHK is not too dependend on debt financing.
CHK has a better Debt to Equity ratio (0.19) than 69.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 9.53 | ||
| Altman-Z | 4.46 |
ROIC/WACC0.33
WACC7.73%
2.3 Liquidity
A Current Ratio of 2.16 indicates that CHK has no problem at all paying its short term obligations.
CHK has a better Current ratio (2.16) than 73.21% of its industry peers.
CHK has a Quick Ratio of 2.16. This indicates that CHK is financially healthy and has no problem in meeting its short term obligations.
CHK has a better Quick ratio (2.16) than 75.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.16 | ||
| Quick Ratio | 2.16 |
3. Growth
3.1 Past
The earnings per share for CHK have decreased strongly by -74.81% in the last year.
CHK shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -8.65% yearly.
The Revenue for CHK has decreased by -58.30% in the past year. This is quite bad
CHK shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -5.46% yearly.
EPS 1Y (TTM)-74.81%
EPS 3YN/A
EPS 5Y-8.65%
EPS Q2Q%-98.44%
Revenue 1Y (TTM)-58.3%
Revenue growth 3Y13.87%
Revenue growth 5Y-5.46%
Sales Q2Q%-73.29%
3.2 Future
Based on estimates for the next years, CHK will show a very strong growth in Earnings Per Share. The EPS will grow by 27.56% on average per year.
CHK is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 19.77% yearly.
EPS Next Y-74.18%
EPS Next 2Y2.06%
EPS Next 3Y18.26%
EPS Next 5Y27.56%
Revenue Next Year-42.93%
Revenue Next 2Y20.29%
Revenue Next 3Y19.77%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 27.43 indicates a quite expensive valuation of CHK.
Based on the Price/Earnings ratio, CHK is valued a bit more expensive than the industry average as 70.81% of the companies are valued more cheaply.
Compared to an average S&P500 Price/Earnings ratio of 29.35, CHK is valued at the same level.
A Price/Forward Earnings ratio of 15.93 indicates a correct valuation of CHK.
The rest of the industry has a similar Price/Forward Earnings ratio as CHK.
The average S&P500 Price/Forward Earnings ratio is at 22.10. CHK is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.43 | ||
| Fwd PE | 15.93 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CHK indicates a slightly more expensive valuation: CHK is more expensive than 63.16% of the companies listed in the same industry.
CHK's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. CHK is more expensive than 64.59% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 87.19 | ||
| EV/EBITDA | 10.11 |
4.3 Compensation for Growth
A more expensive valuation may be justified as CHK's earnings are expected to grow with 18.26% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y2.06%
EPS Next 3Y18.26%
5. Dividend
5.1 Amount
CHK has a Yearly Dividend Yield of 2.82%.
CHK's Dividend Yield is comparable with the industry average which is at 7.12.
CHK's Dividend Yield is a higher than the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.82% |
5.2 History
The dividend of CHK decreases each year by -27.58%.
CHK has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)-27.58%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
74.89% of the earnings are spent on dividend by CHK. This is not a sustainable payout ratio.
DP74.89%
EPS Next 2Y2.06%
EPS Next 3Y18.26%
81.46
-0.79 (-0.96%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners69.55%
Inst Owner Change43.14%
Ins Owners34.93%
Ins Owner Change0%
Market Cap18.48B
Analysts75.83
Price Target97.71 (19.95%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.82% |
Yearly Dividend3.66
Dividend Growth(5Y)-27.58%
DP74.89%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)228.74%
Min EPS beat(2)-6.54%
Max EPS beat(2)464.01%
EPS beat(4)3
Avg EPS beat(4)153.85%
Min EPS beat(4)-6.54%
Max EPS beat(4)464.01%
EPS beat(8)7
Avg EPS beat(8)90.83%
EPS beat(12)10
Avg EPS beat(12)68.05%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-20.53%
Min Revenue beat(2)-36.48%
Max Revenue beat(2)-4.59%
Revenue beat(4)2
Avg Revenue beat(4)7.45%
Min Revenue beat(4)-36.48%
Max Revenue beat(4)45.81%
Revenue beat(8)6
Avg Revenue beat(8)42.17%
Revenue beat(12)8
Avg Revenue beat(12)36.68%
Revenue beat(16)9
Avg Revenue beat(16)22.86%
PT rev (1m)-7.14%
PT rev (3m)-8.21%
EPS NQ rev (1m)-60.96%
EPS NQ rev (3m)-69.49%
EPS NY rev (1m)0%
EPS NY rev (3m)-18.9%
Revenue NQ rev (1m)-5.86%
Revenue NQ rev (3m)-17.02%
Revenue NY rev (1m)-2.47%
Revenue NY rev (3m)-6.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.43 | ||
| Fwd PE | 15.93 | ||
| P/S | 3.77 | ||
| P/FCF | 87.19 | ||
| P/OCF | 10.64 | ||
| P/B | 1.78 | ||
| P/tB | 1.78 | ||
| EV/EBITDA | 10.11 |
EPS(TTM)2.97
EY3.65%
EPS(NY)5.11
Fwd EY6.28%
FCF(TTM)0.93
FCFY1.15%
OCF(TTM)7.66
OCFY9.4%
SpS21.58
BVpS45.7
TBVpS45.7
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.22% | ||
| ROE | 4.22% | ||
| ROCE | 3.31% | ||
| ROIC | 2.57% | ||
| ROICexc | 2.79% | ||
| ROICexgc | 2.79% | ||
| OM | 8.56% | ||
| PM (TTM) | 8.94% | ||
| GM | 78.39% | ||
| FCFM | 4.33% |
ROA(3y)35.26%
ROA(5y)-8.99%
ROE(3y)62.5%
ROE(5y)N/A
ROIC(3y)13.76%
ROIC(5y)9.96%
ROICexc(3y)14.49%
ROICexc(5y)10.54%
ROICexgc(3y)14.49%
ROICexgc(5y)10.54%
ROCE(3y)17.73%
ROCE(5y)12.84%
ROICexcg growth 3Y17.67%
ROICexcg growth 5Y15.1%
ROICexc growth 3Y17.67%
ROICexc growth 5Y15.1%
OM growth 3Y60.28%
OM growth 5Y26.63%
PM growth 3YN/A
PM growth 5Y88.94%
GM growth 3Y5.78%
GM growth 5Y0.58%
F-Score5
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 9.53 | ||
| Debt/EBITDA | 1.05 | ||
| Cap/Depr | 101.13% | ||
| Cap/Sales | 31.14% | ||
| Interest Coverage | 4.46 | ||
| Cash Conversion | 90.14% | ||
| Profit Quality | 48.4% | ||
| Current Ratio | 2.16 | ||
| Quick Ratio | 2.16 | ||
| Altman-Z | 4.46 |
F-Score5
WACC7.73%
ROIC/WACC0.33
Cap/Depr(3y)99.31%
Cap/Depr(5y)100.4%
Cap/Sales(3y)17.38%
Cap/Sales(5y)20.06%
Profit Quality(3y)28.9%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-74.81%
EPS 3YN/A
EPS 5Y-8.65%
EPS Q2Q%-98.44%
EPS Next Y-74.18%
EPS Next 2Y2.06%
EPS Next 3Y18.26%
EPS Next 5Y27.56%
Revenue 1Y (TTM)-58.3%
Revenue growth 3Y13.87%
Revenue growth 5Y-5.46%
Sales Q2Q%-73.29%
Revenue Next Year-42.93%
Revenue Next 2Y20.29%
Revenue Next 3Y19.77%
Revenue Next 5YN/A
EBIT growth 1Y-91.23%
EBIT growth 3Y82.51%
EBIT growth 5Y19.71%
EBIT Next Year-4.53%
EBIT Next 3Y38.42%
EBIT Next 5Y39.9%
FCF growth 1Y-86.46%
FCF growth 3Y192.58%
FCF growth 5YN/A
OCF growth 1Y-37.25%
OCF growth 3Y26.92%
OCF growth 5Y6.59%