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JimVanMeerten (56.76)

Chesapeake Energy get cheaper



August 23, 2011 – Comments (1) | RELATED TICKERS: CHK


My definition of an expert is a person who knows more and more about less and less until he knows everything about nothing at all.  T. Boone Pickens is the guy I consider a expert when it comes to the narrow field of Texas oil and gas.   He is the guy who said there were 2 ways for the US to become energy independent in energy production and he is putting a lot of money on both wind and natural gas.  You cannot turn on a TV discussion about natural gas without hearing them mention Chesapeake Energy (CHK) and right now it's selling a a 19.86 discount to its recent high. 

Barchart technical indicators:

1 - Short term sell indicators can signal when a stock is selling at a discount

2 - Barchart 32% technical sell signal

3 - Trend Spotter sell signal

4 - Trading below its 20, 50 and 100 day moving average

5 - Has lost 19.86% from its 52 week high

6 - Relative Strength Index 40.76% and still falling

7 - Barchart computes a technical support level at 27.18

8 - Recently selling around 28.59 which is below its 50 day moving average of 30.81

Summary: If you agree with T Boone Pickens that natural gas is the answer for US energy independence then it should be hard not to pick up a few shares of Chesapeake Energy (CHK) that is selling at a 19.86% discount to its recent high.  If the sales and earnings projections come in and the stock begins to trade at a more normal P/E ration investors could see a 9% - 11% annual compounded total return over the next 5 year period if you acquire at today's prices.
Jim Van Meerten is a Marketocracy Master

1 Comments – Post Your Own

#1) On August 23, 2011 at 3:16 PM, tmathe85 (< 20) wrote:

There are about a gazillion natural gas wells being drilled right now (high supply) with economic growth anemic at best (low demand)......I wouldnt worry about rushing out to buy CHK but I think its a good company for what they do.

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