Shares of U.S. exploration and production company Centennial Resource Development (NASDAQ: CDEV) fell by roughly 8.5% in morning trading on Wednesday. That decline followed even larger losses from the day before . The news driving both days' sell-offs of the energy stock, however, was basically the same.
After the close on Monday, Centennial Resource Development announced plans to sell $150 million worth of exchangeable senior notes that will mature in 2028. The proceeds from the debt issuance are slated to be used for the repayment of debt that comes due in 2025. It will also reduce its borrowings on a revolving credit line. These are positive moves for its balance sheet , which, given the energy company's modest size and heavy leverage, was a major concern during oil's deep 2020 price decline.
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Why Centennial Resource Development Fell as Much as 8.5% in Morning Action