NEW YORK (TheStreet) -- Shares of Chesapeake Energy (CHK) - Get Report are advancing 7.08% to $3.93 in early-afternoon trading on Tuesday after announcing that it has issued or agreed to issue roughly 5% of its outstanding shares in exchange for debt during the past week. 

The transaction is the second time this month that Chesapeake has swapped debt for equity as the oil and natural gas producer attempts to reduce its more than $9 billion in debt. 

Chesapeake has issued or agreed to issue about 37.1 million shares between May 16 and May 23 in exchange for senior notes worth roughly $166 million, Reuters reports. The notes are due in 2017, 2019, 2037 and 2038.

Earlier this month, Chesapeake swapped $153 million of debt for about 4% of its equity. 

Additionally, the company is likely settling more than 400 lawsuits for $29.4 million, SunTrust wrote in a note, Barron's reports. 

"While critics likely will contend that each of the latest events is a small piece versus total debt/lawsuits, we suggest each step helps," the firm said. "We continue to further contend that Chesapeake remains asset heavy with over 8 million acres, which should easily help cover any upcoming required payments."

Separately, TheStreet Ratings team rates the stock as a "sell" with a ratings score of D+.

Chesapeake's weaknesses include its generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

You can view the full analysis from the report here: CHK

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author. 

Image placeholder title