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Goldman Sachs Cuts Chesapeake Granite (CHKR) to Sell; Sees Sharply Lower Distributions

October 30, 2013 7:27 AM EDT Send to a Friend
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Price: $10.69 --0%

Rating Summary:
    0 Buy, 1 Hold, 2 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 8
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Goldman Sachs downgraded Chesapeake Granite Wash Trust (NYSE: CHKR) from Neutral to Sell with a price target of $11.00 (from $13). Analyst Theodore Durbin thinks poor wells will lead to sharply lower distributions.

"We expect weak well results and a reduced rig count in its sole area of production, Washita County in the Colony Granite Wash, will drive sharply lower volumes and cash distributions to unitholders in coming quarters and years. We also expect a less favorable production mix over time, with more low-margin natural gas and less highmargin NGL and crude oil production. We expect cash flows only slightly above the subordination threshold, leaving limited room for error," said Durbin.

For an analyst ratings summary and ratings history on Chesapeake Granite Wash Trust click here. For more ratings news on Chesapeake Granite Wash Trust click here.

Shares of Chesapeake Granite Wash Trust closed at $14.00 yesterday.




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