Arguing as Barron's/HedgeEye have that their distribution is not safe when they have already announced a distribution increase is not just absurd it is crazy. The record speaks for itself and that includes the deals and hedge book. They lock in margins on deals and if the margin or ability to hedge it is not there they don't do the deal. Yes, hedging is a central part of their strategy but they know what they're doing and are very adept at it.
makes sense, just prior to the June 30th Berry closing and distribution increase.
These guys have a deal dept. bigger than some investment banks. I wouldn't be surprised if there is another acq. sometime soon, maybe not quite as large but some bolt-ons etc.
Agreed, this new LNCO financing vehicle has revolutionized the MLP sector and allows them to have a lower cost of capital for acquisitions than most competitors. Most of the other MLP's that are large enough to handle it are attempting to set up similar vehicles. Also the Berry acq. was essentially a tax free transaction.
Another reason that Linn's management is one of the most respected in the sector and among all upstream cos.
Your dreaming, it had plenty of reason to go over 40 with The Berry news and also no run up before the div distribution..this is a hated stock..and i think That Barrons is on to somthing. I dont trust Linn's Ceo. Look at ETR ,EPD,KMP in last 6 months all way up compared to Line. Somthings rotten in Texas...IMO
There are only a few shares available for lending and present borrow fee is upwards of 9%. Adding a sell order far above present price levels can reduct lending avalability. which as already thin, can help the stock recover.
I took your suggestion and put in a sell order @ 41.75. That will give me a nice profit at the
high end if it runs up to that level again, if not, no harm, me thinks. The shorts will have a
problem as you indicated and that will mitigate any potential freefall in the price.
So basically, what you're saying is that if you tie up all your shares with a GTC sell order at a high price (e.g. $42), due to the pending sell order, the broker can no longer "loan" your shares out for a short sale and it decreases the overall amount of shares available to loan for short purposes. Rather, diabolical. I like it.