It's been a tough year for Chesapeake Energy (CHK) - Get Chesapeake Energy Corporation Report . But the year isn't over and it could get a lot worse.

At least, that's according to the recent analyst coverage from Credit Suisse. Analyst William Featherston hit Chesapeake with an underperform rating and $3 price target. Given Chesapeake stock most recently closed at $3.85, Featherston's price target implies about 22% further downside.

With crude oil prices hovering north of $58 and near its highs for the year, some investors may be brushing off the downgrade. But natural gas, another important component to Chesapeake, hasn't been doing so well.

Still, it's hard to explain shares rallying about 1% on Tuesday. Featherston's base-case scenario calls for a $3 price target. However, his "blue sky" forecast falls for a $5 stock price, while his "grey sky" scenario would send Chesapeake stock all the way down to $1.

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So what gets Chesapeake to blue skies? A rally in energy prices along with improved profitability and cash flow would help levitate shares higher. But right now, that's sort of the problem.

Featherston cites a lack of cash flow per debt-adjusted share growth as one issue. Another is the valuation. Looking at an enterprise value to debt-adjusted cash flow (EV/DACF), the analyst notes that Chesapeake still trades at a premium to its peers, despite the falling stock price. Chesapeake still carries quite a bit of leverage and even if it pares $3 billion in assets, it will still carry higher leverage than many of its peers.

in sum, here's what could turn things around: A rally in natural gas prices, executing on asset sales and reducing its debt load, according to Featherston.

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This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.