NEW YORK (TheStreet) -- Shares of Chesapeake Energy Corp. (CHK) are up 3.24% to $21.98 in pre-market trade after the natural gas and oil exploration and production company reported an increase in third-quarter profit as higher output and cost-cutting compensated for the decline in crude prices, Bloomberg reports.
Net income increased to $662 million, or 26 cents a share, from $202 million, or 24 cents, a year earlier, the company said in a statement. The per-share result, excluding certain one-time items, was 5 cents more than the 33-cent average of 26 analysts estimates compiled by Bloomberg.
Chesapeake CEO Doug Lawler has been selling or spinning off gas fields, pipelines, office buildings and drilling rigs as part of a strategic shift into more profitable crude-oil production. Lawler, who succeeded Chesapeake co-founder Aubrey McClendon last year amid an investor revolt, has also been cutting costs and untangling complex financial arrangements favored by his predecessor, Bloomberg noted.
"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 revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, unimpressive growth in net income and poor profit margins."
- You can view the full analysis from the report here: CHK Ratings Report