Chesapeake Granite Wash Trust: Price momentum supported by strong fundamentals

Chesapeake Granite Wash Trust relative valuation is OVERVALUED and it has a fundamental analysis score of 61.

Our analysis is based on comparing Chesapeake Granite Wash Trust with the following peers – MV Oil Trust Units, Freeport-McMoRan, Inc. and Sandridge Mississippian Trust I (MVO-US, FCX-US and SDT-US).

Chesapeake Granite Wash Trust has shown good performance overall, both over the last one year (at 52.17%) as well as over the last month (at 43.18%). Share price performance over the last month, though has been lower than that over the last year. But Chesapeake Granite Wash Trust’s stock has done better than its overall peer group whose performance was 18.19% over the last month.

Company Snapshot

  • From a peer analysis perspective, relative outperformance last month is up from a median performance last year.
  • Chesapeake Granite Wash Trust’s current Price/Book of 3.35 is about median in its peer group.
  • The market expects CHKR-US to grow at about the same rate as the peers and to maintain the median returns it currently generates.
  • CHKR-US has relatively high profit margins while operating with median asset turns.
  • Compared with its chosen peers, changes in the company’s annual earnings are better than the changes in its revenue, implying better than median cost control and/or some economies of scale.
  • CHKR-US‘s return on assets currently and over the past five years is around the peer median and suggest that it does not have any particular operational advantages versus peers.
  • CHKR-US‘s revenue growth in recent years and current P/E ratio are both around their respective peer medians suggesting that historical performance and long-term growth expectations for the company are largely in sync.
  • The company’s capital investment program suggests it is under-investing in a business that is producing peer median returns.
  • CHKR-US currently does not have any debt.
  • Our analysis rates Chesapeake Granite Wash Trust as OVERVALUED relative to its peers.

Share Price Performance

From a peer analysis perspective, relative outperformance last month is up from a median performance last year.

While CHKR-US‘s change in share price of 52.17% for the last 12 months is in line with its peer median, its more recent 30-day share price performance of 43.18% is above the peer median. This suggests the company’s performance has improved more recently relative to peers.

Share Price Performance

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Leading, Fading, Lagging, Rising

Relative Valuation

Relative Valuation
Fundamental Score

Chesapeake Granite Wash Trust’s price of USD 3.15 is greater than CapitalCube’s implied price of USD 1.99. At this level, CapitalCube believes that Chesapeake Granite Wash Trust is overvalued. Over the last 52 week period, the stock has fluctuated between USD 1.81 and USD 3.83.

Valuation & Peer Metrics

A complete list of valuation metrics is available on the company page.

Company Profile

Chesapeake Granite Wash Trust engages in the ownership of royalty interests. It owns royalty interests in oil, natural gas liquids and natural gas properties located in Washita County, Oklahoma producing from the colony granite wash play within the broader granite wash formation of the anadarko basin. The company was founded on June 29, 2011 and is headquartered in Austin, TX.

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