Chesapeake Might Sell Itself, BP Also Significantly Undervalued
By Takeover Analyst:In my previous articles on Chesapeake Energy (CHK) and BP (BP), I have sought to defend the companies and their respective management teams from what I felt was unwarranted criticism. When investors become driven by emotion, they often lose sight of the fundamentals. In the instances of Chesapeake and BP, behavioral anomalies have distorted value. Takeover activity will dissipate the bearish negativity.At Chesapeake, Aubrey McClendon has assembled leading assets in natural gas that, while highly leveraged, will generate substantial returns when the political economy inevitably has to answer its foreign policy and energy woes. Natural gas is at its low and yet we have a 100 year supply to fuel industrial growth. Chesapeake will be riding these positive secular trends--considerable value at an affordable ~2x operating cash flow price. Now that Icahn has intervened, the dialogue surrounding the company has rightfully changed. Investors are starting to refocus on theComplete Story »
- Original article
- Login or register to post comments

