NEW YORK (TheStreet) -- Penn Virginia Corporation (PVA) stock is lower Monday after announcing it had entered a definitive agreement to sell its Mississippi assets to an undisclosed buyer for a total $72.7 million. The properties on the chopping block had net production of around 11.9 million cubic feet of natural gas equivalent per day. After the sale, 2014 production will decrease by around 1.9 million cubic feet of natural gas equivalent.
On the news, shares tumbled 7.4% to $14.05. Trading volume of 4.1 million shares had exceeded its three-month daily average of 3 million.
The asset sale is expected to close in July, subject to customary closing conditions. Scotia Waterous (USA) Inc. served as PVA's exclusive financial and technical advisor in connection with the transaction.
TheStreet Ratings team rates PENN VIRGINIA CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate PENN VIRGINIA CORP (PVA) 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, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and disappointing return on equity."