Topic: Growth Stocks

Stock Pickers Digest Hotline – Friday, February 1, 2013

Article Excerpt

CHESAPEAKE ENERGY CORP., $20.33, symbol CHK on New York, is up 7.0% from $19 this week. That’s largely because the company’s controversial co-founder, CEO and chairman, Aubrey K. McClendon, has agreed to retire on April 1, 2013. McClendon is under investigation by the U.S. Securities and Exchange Commission (SEC) for taking out $1.1 billion of loans from EIG Global Energy Partners that may have put him in a conflict of interest. EIG is a big lender to Chesapeake, and that’s where the potential conflict arises. It has also come to light that McClendon ran a $200-million hedge fund between 2004 and 2008 that traded in the same commodities that Chesapeake produces. The retirement will come at a price to Chesapeake: McClendon is entitled to total compensation of about $47 million, consisting of $11.7 million in cash paid out over four years and $33.5 million of stock. However, his departure removes the perception that he has not been devoting his full attention to…