A few months ago, I really liked LINE! Now, with a dozen lawsuits, an open SEC investigation, and the Berry merger extremely questionable, to put money into LINE right now seems far more like gambling than investing! Stakes are high either way. Either win big or lose big. For now, I've moved my assets elsewhere, but will watch closely for a season and am open to reasonable persuasion to buy back.
This is nothing more than a text book bear raid about a talking point that is not new and not unknown. The SEC looked at Line's books for the LNCO IPO and then they were looked at again by bankers involved in the Berry deal and looked at again by Cooperman's people and nobody found any problems. The bears have done this to HLF on several occasions and will probably do it again. I suspect they will wait a couple of years and do it again with Line. Under normal circumstances, I would agree with you.
If I would have held, I would still be DOWN, DOWN, DOWN!! I bought LINE at close to 31 per unit and thought I was getting a steal-of-a-deal. I sold several weeks later at 34 and some change. And, I'm so glad I did! Honestly, I just simply "lucked" out of losing a lot of money thanks to a post that made me believe the Berry merger was dead. That post ended up being worded terribly wrong and the price bounced back up by the end of the day. I however decided to wait on the sidelines and see what would happen. Then, the next week, the bottom of the bucket fell out. I'm glad I sold when I did.
You may be right though-- I may later wish I had held. Or, I may really regret not buying in while it's still so very low.
If only I were omniscient!
New2investment. The only reason I can think of to invest in LINE is the upside from a depressed PPS due to concerted short attack. There is upside to average price not counting some good happening. Don't invest in a way that makes you uncomfortable. If something looks good but you harbor doubts , add or buy small. Stay in your comfort zone.
Sentiment: Strong Buy
I sold my LINE long calls today for a 87% gain and now to enjoy a long vacation with sporadic or no Internet . I. Believe I could have gained more by holding but the vacation would have been less enjoyable.
Best of luck to all longs.
There is one good reason to buy now. Every major financial institution has seen nothing wrong with LINEs accounting and has them as at least a market outperform. Goldman was the last to say this is a good entry point. One good reason to hold off for now. Uncertainity
The shorts have been remarkably silent after wildly over playing it. Nor did Hedgeye continue their subscription building strategy of destroying more public traded partnerships.
Now they are in a position of desperately hoping there is something no one knew about in the accounting. Extremely unlikely but not impossible given how long the SEC has been doing due diligence.
Before the short attack BRY hired three independent valuations of LINE which came in around $36. LInn did the same and came in around $39. None of these valuations included the BRY deal with more oil and lowering the debt ratio. Both of which was enough to drive away shorts except for the SEC investigation.
LINE has good assets and a full hedge book. Management does not execute and a small distribution cut is possible. But higher oil and heavier ngl prices certainly are a nice little boost right now.
The most likely outcome is that LINE owners do very well from these valuations. The LINE/LNCO mispricing remains so perceived risk is certainly not being priced logically. If the SEC finishes a clearly lengthy and throughout investigation with no material problems? Yea logically there would be a move quick move up.
Good fortune to you. Please say hello to Tweetie MeHedgie at Hedgeye on the way past.
OK, so obviously, the initial BRY/LNCO deal won't go through as drafted (1 share of BRY for 1.25 shares of LNCO). I assume if there is to be a deal, then BRY and LINE will be forced to draft a new exchange rate and publish that prior to merging, then go through all the hoopla again of scheduling dates, acquiring board and unit holder votes, etc. Seems to me the time to buy would be after BRY and LINE publish their next move regarding this potential merger. Sure the price will shoot straight up (IF that happens), but boy will it shoot straight down if the merger falls apart IMHO.
Uh . . . okay. The lawsuits are just the normal nonsense, they'll all end up in the dumper, there is no SEC investigation, every party associated with the Berry transaction says they are committed to it, and LINE is $10 under where it should be trading, even without the Berry deal.
Sorry--SEC inquiry (not investigation). Still, when the SEC gets involved, it does make me feel uncomfortable putting my money in until they declare, "all's good with their accounting."
Regarding lawsuits - really. That's just the "norm." What? You really mean that you invest in companies that have dozens of lawyers clamoring to squeeze money from the company? You think it's a good time to invest when those suits are yet unsettled? In my research, there are PLENTY of solid companies out there without the pending litigation and the fact that there are so many suits adds a lot of risk.
Regarding price-point, I kind of agree. I think LINE MAY be worth more than it's presently trading at. My hunch is the reason it is trading low is because the risk is very high, and investors like me prefer a lot less risk. It's "investing" not gambling!