http://enlightened-american.com/2008/04/05/chesapeake-energy-ups-the-ante One person's quest to make sense of a senseless American economy and society. Sun, 08 Jan 2012 12:07:34 +0000 hourly 1 http://wordpress.org/?v=3.0 http://enlightened-american.com/2008/04/05/chesapeake-energy-ups-the-ante/comment-page-1#comment-488 The Enlightened American » Chesapeake Energy Reverts Back To Resource Acquisition Mode Mon, 02 Jun 2008 05:13:13 +0000 http://enlightened-american.com/2008/04/05/chesapeake-energy-ups-the-ante/#comment-488 [...] Are the new assets worth it? If management lives up to its prior track record, the answer is an unqualified yes and then some. McClendon, one of the most respected CEOs in the industry, has gone on record stating that this (Haynesville) could be the biggest thing to ever happen to the company and eventually expects returns from Haynesville to exceed those of its Barnett Shale position. He also presents an interesting case that Chesapeake is being grossly undervalued by the market, basing it on the SEC’s PV-10 valuation and then adding in midstream assets, 37 tcfe unproved reserves and ignoring millions more less-glamorous acreage that the company feels is valuable nonetheless.  According to this math, the company is worth at least $61B ($99 per share net of debt) compared to an enterprise value of $39.5B around the time of the conference call.   Readers can see my rough valuation of Chesapeake from a previous post. [...] [...] Are the new assets worth it? If management lives up to its prior track record, the answer is an unqualified yes and then some. McClendon, one of the most respected CEOs in the industry, has gone on record stating that this (Haynesville) could be the biggest thing to ever happen to the company and eventually expects returns from Haynesville to exceed those of its Barnett Shale position. He also presents an interesting case that Chesapeake is being grossly undervalued by the market, basing it on the SEC’s PV-10 valuation and then adding in midstream assets, 37 tcfe unproved reserves and ignoring millions more less-glamorous acreage that the company feels is valuable nonetheless.  According to this math, the company is worth at least $61B ($99 per share net of debt) compared to an enterprise value of $39.5B around the time of the conference call.   Readers can see my rough valuation of Chesapeake from a previous post. [...]

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