Based on the price of the assets acquired on each balance sheet of both QRE and LINE, QRE is priced at double the price of the assets of those acquired by Linn Energy. I have no idea why investors would pay double for its assets than those that were acquired by Linn Energy.
QRE should be much lower in price. I said this six months ago and I still say that. QRE is selling close to 4x its assets and Linn energy is selling below 2x assets.
Boy, the posts you get on days like these. Well, just in case there's some newbie who doesn't know this already, GAAP historical cost means NOTHING. QRE is a recently formed company, and all its assets are newly acquired, they start with a cost basis at that purchase price. LINE is relatively old for an upstream, and the price of oil has increased substantially since then. Further, GAAP accounting requires the asset carrying cost to be reduced by depletion, even if the actual market value has decreased. The poster doesn't even discuss debt, it's net assets that would matter, even if his post made any sense, which it doesn't.
What metrics should you look at for an upstream? Reserve composition and life, leverage to cash flow, coverage, quality of management, not the GAAP financials, which are useless, for the reason noted above, and for the treatment of hedging derivatives, which produces absurd earnings swings that have no basis in reality.
I just bought a bunch more on fri at 15.2, my thinking is that qre is mostly liquids reserves and has a big upside. regarding linn's rebound, because qre is much smaller it will take the market longer to notice qre
Ruby, I want to buy in on QRE, do You believe it will hold now or as seeking alfa says, it or maybe it`s LINE they say will fall further, would appreciate your opinion on this. I know You, Liza, Jaime- most all posters here know this game, I believe this a very good time to buy in now.