Market Insider

Chesapeake surges after Q1 earnings come in line; firm reports assets sale

A floor crew pull steel pipe out of a natural gas well in the Barnett Shale of Fort Worth, Texas that is owned by Chesapeake Energy Corporation.
Robert Nickelsberg | Getty Images

Shares of Chesapeake Energy jumped more than 10 percent in early trading Thursday after posting quarterly earnings that met analyst expectations.

The stock gave up some of its earlier gains and closed up 1 percent.

The second-largest U.S. natural gas producer reported an adjusted first-quarter loss of 10 cents a share on Thursday, in line with Reuters estimates, and said it struck a $470 million deal with Newfield Exploration for some assets in Oklahoma.

Chesapeake said it would sell about 42,000 net acres of its fields, with current production of 3,800 barrels of oil equivalent per day.

Analysts at Sterne Agee CRT said these two factors "further dent the weakening bear case on CHK shares."

"We expect CHK shares to respond favorably to another bullish reset to asset sale proceeds that minimizes the impact to current production, as well as to continued strong operational results," they said in a note to clients.

Chesapeake shares were up more than 25 percent entering Thursday trading, but remained 64 percent lower over the past 12 months.

CHK in the past year

Source: FactSet

— Reuters contributed to this report.

Disclosure: Sterne Agee CRT makes a market in Chesapeake.