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What: June wasn't a good month for Chesapeake Energy Corporation (NYSE:CHK). The natural gas giant's stock was under pressure all month thanks to a number of negative news items, ranging from weak data points to negative analyst commentary. This negativity really weighed on the stock, driving it down 19.4% for the month.

So what: The driving force behind Chesapeake Energy's poor performance last month was a bevy of weak data points in the natural gas industry. The industry is currently producing record amounts of natural gas, with no signs of a slowdown -- in fact, the Natural Gas Supply Association sees production hitting a record this summer. That surge is coming at a time when natural gas in storage is at a 12-year high according to the U.S. Energy Information Administration, suggesting that the country doesn't need more gas at the moment. This oversupply is putting pressure on the price of natural gas. To make matters worse, natural gas liquids prices continue to weaken as these are also oversupplied, and analysts expect this weakness to take a 3% chunk out of Chesapeake Energy's cash flow next year.

Speaking of analysts, they had few good things to say about Chesapeake Energy in June. Oppenheimer downgraded the company to "Perform" from "Outperform", as weak energy prices are expected to cause the company to have free cash flow deficits of $2.1 billion this year and $2.7 billion next year. Not to be outdone, UBS downgraded the company to a "Sell" from "Neutral" as a result of the company having "far too much financial leverage."

That said, not all analysts are negative on the company -- Sterne Agee CRT actually upgraded the stock to a "Buy" from "Underperform". That upgrade is due to the fact that Chesapeake's stock has fallen so much that it's now seen as being "oversold" by investors as its issues aren't "fatal".

Now what: June was a rough month for Chesapeake Energy -- weak data points didn't give investors any reason to be bullish on the stock. It also didn't help matters that the stock was downgraded by a couple of analysts, who reminded investors of the impact this weak data will have on the stock in the short-term. That said, as the Sterne Agee CRT analyst pointed out, the stock has been hit hard despite the fact that its issues won't cause the company to collapse.

 

Matt DiLallo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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.