Why Chesapeake Energy (CHK) Stock Is Up Today

NEW YORK (TheStreet) -- Chesapeake Energy Corp. (CHK) closed up 1.9% to $26.13 in trading Tuesday.

The bump comes following a Moody's  (MCO) report that states that gas producers in the Marcellus shale region will benefit more than gas producers elsewhere in North America.

"Technological advancements since the early 2000s have allowed U.S. natural gas producers to reshape the industry largely through the development of the Marcellus," said Associate Analyst Michael Sabella, the author of the study.

"The Marcellus has emerged as one of the most profitable regions in the U.S. for producing natural gas, so even if prices return to the weak levels of 2012, producers there will be rewarded,"he added. 

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The Marceullus natural gas trend encompasses 104,000 square miles across West Virginia and Pennsylvania. Moody's lists the proximity of the natural gas to East Coast hubs as one of the advantages of exploration in the region.

TheStreet Ratings team rates CHESAPEAKE ENERGY CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate CHESAPEAKE ENERGY CORP (CHK) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and generally higher debt management risk."

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