Chesapeake Energy Rebounding From Rough Patch and Looking Strong
In a mere two months since observers dubbed the shareholder revolt at Chesapeake Energy “historic,” events have proven they were right, happily so for this industry giant’s stakeholders. In the aftermath of the boardroom and C-Suite changes that occurred in June, share value has enjoyed strong double-digit growth (as of late last week).
Chesapeake’s second-quarter earnings report, released early last week, confirms that the company sold $4.7 billion worth of assets in Q2 and anticipates unloading $7 billion more in Q3. (Analysts particularly welcomed that projection.) The company promises to limit unproven gas and oil property acquisitions to $2 billion this year and a stunningly low $400 million in 2013. What a difference a day makes!
But as with all “historic” events, there are larger forces at work than numbers and projections. In the case of Chesapeake, the shareholder revolt was itself just such a decisive force because it sent an indubitable message to the marketplace – that here is a company with all the resolve it needs to set a sound business course and stick to it.