NEW YORK (TheStreet) -- Shares of Chesapeake Energy (CHK) were gaining 2.2% to $18.94 after-hours Monday after completing the sale of its Southern Marcellus and Utica Shale assets to Southwestern Energy (SWN) and announcing a new buyback plan.
Chesapeake Energy sold the shale assets to Southwestern Energy for net proceeds of $4.975 billion, $400 million less than its previously announced price due to a settlement for various items which include Southwestern's waiver on future claims to title defects and environmental liabilities.
The properties sold consist of about 413,000 net acres and 1,500 wells in West Virginia and Pennsylvania with a net production of 57,000 barrels of oil equivalent a day, including related property, plants, and equipment.
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Chesapeake Energy also announced that its board of director approved a $1 billion buyback plan.
TheStreet Ratings team rates CHESAPEAKE ENERGY CORP as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CHESAPEAKE ENERGY CORP (CHK) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, increase in net income, reasonable valuation levels and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows weak operating cash flow."