Calpine, Dynegy Stocks Fall Again

Hard-hit energy merchants labored Monday to reassure Wall Street that they haven’t contracted the Enron disease, but the stocks of Calpine Corp., Dynegy Inc. and others tumbled anyway.

Investors have been punishing energy traders and independent power producers since the spectacular disintegration of Enron Corp., which filed the largest bankruptcy in U.S. history on Dec. 2 after a rapid seven-week decline.

San Jose-based Calpine, in particular, has been pummeled by what it says are unfounded comparisons to Enron.

On Friday, Moody’s Investors Service downgraded Calpine’s credit rating to junk only two months after boosting it to the lowest investment grade. Calpine, the nation’s largest independent energy producer, on Monday reaffirmed that its operations have not been affected by the downgrade.

Calpine is “committed to taking the steps necessary to address today’s challenging financial and power markets, and to bring on line highly efficient generating facilities--adding strong, sustainable cash flow,” said Bob Kelly, president of Calpine Finance Co.

Still, Calpine’s stock slipped 30 cents to close at $12.90 a share on the New York Stock Exchange after falling as low as $11.81. Calpine is building power plants capable of generating 17,000 megawatts of electricity; it operates 12,000 megawatts of generation.

Dynegy on Monday announced plans to strengthen its balance sheet that include selling assets and issuing stock. Moody’s also cut Dynegy’s credit rating on Friday to its lowest investment grade.

Dynegy’s stock closed at $21.70 a share, down $3.24, on the NYSE.

“With the Enron bankruptcy, there’s been increased focus on the sector and more efforts by chief executives to determine what went wrong and to adjust their own capital structure,” Dynegy Chief Executive Chuck Watson told analysts. “We’re no different.”