Tuesday, October 15, 2013

Nuverra: Liquidity Fears Overblown


While some continue to fret over debt issues at Nuverra Environmental (NES), the company recently announced an update to an important credit facility to provide it more time to turn around operations before encountering liquidity issues. The move shouldn't be a huge surprise to investors, as creditors normally want to work with companies to provide ample time to improve numbers to acceptable levels. Not to mention, our previous article highlighted how positive operating cash flows would make it a slam-dunk for the modified covenants, if needed.

The company is dedicated to the protection and enhancement of environmental solutions for the removal and disposal of restricted fluids primarily from shale drilling. It has scattered operations in most of the shale areas with a focus on the Bakken shale from the Power Fuels merger last year. Several catalysts for improving operations include the shift away from contract workers in the Marcellus shale and new management to guide the Eagle Ford segment that struggled during Q213.

Read the full article at Seeking Alpha.


Disclosure: Long CJES and NES. Please review the disclaimer page for more details. 



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