Chesapeake Energy Increases Sales but Misses Estimates on Earnings

Seth Jayson, The Motley Fool
Updated

Chesapeake Energy (NYS: CHK) reported earnings yesterday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Chesapeake Energy whiffed on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue expanded significantly and GAAP loss per share shrank.


Margins improved across the board.

Revenue details
Chesapeake Energy logged revenue of $2.42 billion. The 10 analysts polled by S&P Capital IQ foresaw net sales of $2.71 billion on the same basis. GAAP reported sales were 50% higher than the prior-year quarter's $1.61 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.18. The 32 earnings estimates compiled by S&P Capital IQ averaged $0.28 per share. GAAP EPS were -$0.11 for Q1 against -$0.32 per share for the prior-year quarter.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 30.2%, 1,360 basis points better than the prior-year quarter. Operating margin was 0.2%, 1,810 basis points better than the prior-year quarter. Net margin was -1.2%, 880 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $2.83 billion. On the bottom line, the average EPS estimate is $0.34.

Next year's average estimate for revenue is $11.64 billion. The average EPS estimate is $1.41.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 7,492 members rating the stock outperform and 232 members rating it underperform. Among 1,433 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,393 give Chesapeake Energy a green thumbs-up, and 40 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Chesapeake Energy is outperform, with an average price target of $28.48.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Chesapeake Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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