Financial Analysis: Chesapeake Energy (EXE) vs. Its Peers

Chesapeake Energy (NASDAQ:EXE) is one of 286 publicly-traded companies in the “Crude petroleum & natural gas” industry, but how does it weigh in compared to its peers? We will compare Chesapeake Energy to related businesses based on the strength of its dividends, earnings, valuation, analyst recommendations, profitability, institutional ownership and risk.

Dividends

Chesapeake Energy pays an annual dividend of $2.30 per share and has a dividend yield of 2.5%. Chesapeake Energy pays out 142.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Crude petroleum & natural gas” companies pay a dividend yield of 10.6% and pay out 119.2% of their earnings in the form of a dividend. Chesapeake Energy lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Insider and Institutional Ownership

97.9% of Chesapeake Energy shares are held by institutional investors. Comparatively, 53.9% of shares of all “Crude petroleum & natural gas” companies are held by institutional investors. 0.2% of Chesapeake Energy shares are held by insiders. Comparatively, 9.1% of shares of all “Crude petroleum & natural gas” companies are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Chesapeake Energy and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chesapeake Energy	6.07%	2.74%	2.08%
Chesapeake Energy Competitors	-3.42%	7.39%	6.67%

Analyst Ratings

This is a summary of current recommendations and price targets for Chesapeake Energy and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chesapeake Energy	0	2	3	1	2.83
Chesapeake Energy Competitors	2154	11607	16196	624	2.50

Chesapeake Energy presently has a consensus target price of $99.20, indicating a potential upside of 7.41%. As a group, “Crude petroleum & natural gas” companies have a potential upside of 22.26%. Given Chesapeake Energy’s peers higher possible upside, analysts plainly believe Chesapeake Energy has less favorable growth aspects than its peers.

Risk and Volatility

Chesapeake Energy has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500. Comparatively, Chesapeake Energy’s peers have a beta of -13.38, indicating that their average share price is 1,438% less volatile than the S&P 500.

Earnings and Valuation

This table compares Chesapeake Energy and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Chesapeake Energy	$8.72 billion	$2.42 billion	57.01
Chesapeake Energy Competitors	$12.21 billion	$1.07 billion	-605.40

Chesapeake Energy’s peers have higher revenue, but lower earnings than Chesapeake Energy. Chesapeake Energy is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Chesapeake Energy peers beat Chesapeake Energy on 8 of the 15 factors compared.

About Chesapeake Energy

Expand Energy Corporation is an independent natural gas producer principally in the United States. Expand Energy Corporation, formerly known as Chesapeake Energy Corporation, is based in OKLAHOMA CITY.