Bullish Case for Chesapeake Energy Corporation (NYSE:CHK)

Chesapeake Energy Corporation (NYSE:CHK) is losing value these days even after reporting better-than-expected first quarter results. The oil company’s revenue increased by 41% in the period on year-over-year basis, while it earned a net profit for the first time in two years. But Chesapeake shares are suffering due to the volatile market condition. The oil prices aren’t stabilizing amid differences in OPEC and rising shale production in the US.

Analysts think that Chesapeake’s shares will gain value because the company is steadily cutting its production costs. In the first quarter, Chesapeake’s production cost was just $2.84 per boe.

Chesapeake is also taking solid measures to bring down its debt. Investment firm SunTrust Banks recently gave a “Buy” rating for Chesapeake Energy Co. (NYSE:CHK) stock with a price target of $9.00. Two of the top analysts at Macquarie recently said in a report that Chesapeake’s measures to improve its business will take time to show their effects.

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