One-time high-flying natural gas producer Chesapeake Energy Corp. (NYSE: CHK) has seen its stock price plummet from more than $30 a share just three years ago to below $2 in early 2016 before posting a recent high of $8.20 late last year. Those of us with long memories recall those heady days in 2008 when the stock sold for around $66 a share.

Falling natural gas prices (which were in the neighborhood of $13 per thousand and Chesapeake borrowed heavily to acquire acreage for new drilling. That borrowing left the company with more than $13 billion in long-term debt which it has whittled down to below $10 billion even as gas prices have plunged.

Selling off assets has succeeded in reducing the debt, but combined with low prices, asset sales have made it nearly impossible for the company meaningfully to increase production. The tale will be told again when Chesapeake reports second-quarter earnings Thursday morning.

Analysts are expecting adjusted earnings per share (EPS) of $0.15 on revenues of $2.3 billion. In the second quarter of last year the company posted a loss per share of $0.14 on revenues of $1.62 billion.

The stock traded down about 2.8% Tuesday afternoon due, according to MarketWatch, to options traders’ expectations for a sharp reaction to tomorrow morning’s earnings announcement:

A volatility play known as a straddle is pricing in a 7.1% one-day post-earnings move in Chesapeake’s stock in either direction, compared with the average one-day move of 6.0% after the past 20 quarterly reports.

Chesapeake has drawn little comfort as well from its investments in oil production. Again the problem is low prices for crude and insufficient access to affordable capital. Oil won’t save the company in the second-quarter either. About the only thing that will is further asset sales and a paring of operating costs.

The company is stuck between a rock and a hard place and it will have to choose between them, and when it does, that straddle bet will pay off. Will tomorrow be the day?

Chesapeake’s stock traded down about 2.6% at $4.66 in the mid-afternoon Tuesday in a 52-week range of $4.38 to $8.20. The stock’s consensus 12-month price target is $5.36.

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