% | $
Quotes you view appear here for quick access.

QR Energy, LP Common Units repr Message Board

  • richardleeds richardleeds Jul 5, 2013 1:35 PM Flag

    QRE still selling for twice the price of LINE

    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.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I hope you're not trying to use this as a reason to buy LINE. And this is coming from someone who bought LINE on Friday. This is a GRASPER.

    • The only thing that really matters for an MLP, is can they cover the distribution? They shouldn't be priced like regular stocks; they aren't regular stocks.

      Sentiment: Strong Buy

    • 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.