5-Star Stocks Poised to Pop: Chesapeake Energy

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, natural gas producer Chesapeake Energy (NYSE: CHK  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Chesapeake's business and see what CAPS investors are saying about the stock right now.

Chesapeake facts

Headquarters (Founded)	Oklahoma City (1989)
Market Cap	$16.3 billion
Industry	Oil and gas exploration and production
Trailing-12-Month Revenue	$10.9 billion
Management	Co-Founder/Chairman/CEO Aubrey McClendon CFO Domenic Dell'Osso
Return on Capital (Average, Past 3 Years)	6.6%
Cash/Debt	$111.0 million / $11.8 billion
Dividend Yield	1.4%
Competitors	Anadarko Petroleum (NYSE: APC  ) BP (NYSE: BP  ) ConocoPhillips (NYSE: COP  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 7,553 CAPS members who have rated Chesapeake believe the stock will outperform the S&P 500 going forward. These bulls include meeyatch69 and callumturcan.

Just last month, meeyatch60 tapped Chesapeake as a cheap opportunity: "[S]eems like a good bargain for a leader in the sector. Natural Gas will usage will increase as consumers continue to be receptive to alternatives to petroleum."

In fact, Chesapeake trades at a particularly paltry price-to-cash flow of 3.9. That represents a discount to competitors like Anadarko (6.8), BP (8.1), and Conoco (5.1).

CAPS member callumturcan elaborates on the Chesapeake bull case:

More and more of our electricity will be from natural gas, and the current political climate is pushing for more natural gas usage and production, primarily from the Republicans. In 2005, 20% of the USA electricity market was from natural gas, now it is just over 24% in 2011. Chesapeake has prime real estate to benefit from this surge, with plays in various shale areas. It should outperform the market and continue to go up.

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