(Chesapeake Energy story updated for company commentary on nat gas hedges, land acquisitions)
NEW YORK (TheStreet) -- Chesapeake Energy (CHK) rallied on Tuesday after completing its $2.3 billion Utica shale deal with Total (TOT), but the surge was telegraphed to a degree because the deal was originally announced two months ago.
Now investors are asking: Will the pop in Chesapeake shares last in 2012?
The energy sector started the year in rally mode, with the sector up 3% on Tuesday, and Chesapeake shares outperformed with a gain of nearly 6% to $23.60.A $2 billion deal from Devon Energy (DVN) also helped buoy the group, as did a $4-plus rally in crude and the market's broad gain of nearly 2%. Chesapeake shares lost 15% in 2011 and were trading at a 52-week low to start the year, so in some respects the stock had nowhere to go but up. Analysts are forever debating the company's true value. Is it trading at half of its net asset value or is it impossible to hang a valuation on Chesapeake because of the web of accounting that shrouds its many joint ventures and affiliated companies? Chesapeake CEO Aubrey McClendon said in a recent interview that its joint ventures are no different than those of other energy companies, but few analysts -- even those who are bullish on the stock -- agree. Is Chesapeake well placed at the $22 52-week low at which is began trading in 2012, or is it headed back to at least its 52-week high of $35 in 2012? Here are 5 catalysts for Chesapeake Energy in 2012 that could help answer that question:
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