No surprise here. They sue just because the stock dropped on an SEC inquiry. It's a race to see who gets to represent the class, should one ever be awarded. When it turns out the SEC doesn't come up with anything, there is no longer a basis for the suit. The attorneys were just going for a settlement anyway and hoped never to find themselves in an actual suit that cost them time and money. I wish we would have some reforms that forced those making these frivolous suits pay when they lose. It would greatly reduce the taxpayer expense for such waste.
I hold nearly 200K units in various accounts. Having purchased my position last summer on the fall, I am very pleased with management. While they perhaps got overly aggressive with put accounting and set themselves up for the bear attack, it was the bear attack with the resulting SEC inquiry that spoiled the BRY deal. Since that time, they have done the right things with the cards they hold IMO and the environment remains constructive (high commodity prices, low interest rates, plenty of acquisition targets) for them to implement their strategy. I suspect we will see your $35 to $37 objective this year. However, to get back to $42, it will likely take an increase in the distribution and a general expectation that further increases will continue in the future. I just don't see this stock trading at less than an 8% distribution rate. An 8% distribution today would be a stock price of $36.25, so that may be a cap without further distribution increases or other materially favorable news, but that's quite a bit higher than we are today. GL
but I think LINE management is setting the table to surprise the investment community with an increase in the distribution once they swap or sell the balance of the Permian assets. I agree with the Citi analyst who suggests they are underestimating the cash impact of this deal (so they won't get pressured to make any moves on the distribution now), but will be able to reassess on the next deal when they have all the facts of where they end up. Then, they can increase the distribution and get the stock moving aggressively higher with such large short volume in play.
No way on God's green earth I would stand up and proudly hold up a smartphone at this stage of the product cycle like it's an accomplishment. If the stock hits $350, I'm all over it again for the ride back down to $290. More losses will not help AMZN shareholders. However, I do appreciate the opportunity to get back into AAPL at a little bit lower price on its way to $150!
I will leave it up to people who better understand this market to assess your math, but my understanding is that another benefit of the deal will be lower (or reallocated to other opportunities) operating costs from not having to develop the Permian assets. So, whatever the math on the production, the lower investment requirements need to be added on.
Not clear to me just how much extra cash this deal generates and how much additional extra cash can be realized with the swap or sale of the remaining acreage. However, simply securing the current distribution with a nice cushion should go a long way towards helping get the stock price moving in the right direction. To me, that's more important than if they stretch to raise the distribution only to be relentlessly attacked on whether its sustainable. Of course, I would enjoy both an increase and a cushion.
AAPL can't do anything about it. It would be an SEC issue, but look at all the manipulation that occurs that they opt to ignore. The stock market is basically an organized crime and the manipulation is systematic and engrained in the process. It's so pervasive that there is probably nothing that could be done about it, even if they chose to try.
The G20 is discussing tackling what they claim is a $57 trillion global infrastructure deficit by loosening the rules relating to such entities as insurance companies and pensions to more readily fund such projects. They claim doing so would quickly increase global growth about 2% annually. IF they could make progress along these lines, it would seem any announcement of such would cause VALE to move up aggressively. Regardless, the magnitude of the problem would seem to support VALE stock over time. I found article on AAPL site, as they were mentioned it in relating to taxation.
Well, not everyone got it because Kaiser at Hedgeye was telling their customers (if they actually have any) to sell or short the stock because it was heading to the low $20's.
You must have missed the results and call, so let me fill you in. Cash flow was up and already sufficient to cover the dividend. Cash flow is forecast to increase further in 2H14 due to higher volume, lower cap-ex and anticipated higher I/O prices. More likely to see a special additional dividend than a cut.
I'm on your side, but I don't think any respectable hedge fund was shorting LINE with a 10% distribution and a "known" impending catalyst (this deal, and perhaps now a second one). Obviously, there are shares short and people are responsible for them, but I would be shocked if they are truly professional investors. Most likely, folks like those who listen to Kaiser at Hedgeye (which makes them unprofessional investors to begin with).
Not disappointing to me. Just bought another 20,000 LNCO at $27.50. It's a gift. What you have to understand is that the professional buyers have to due their diligence on the deal and re-run their models, meet and get approvals before they buy. By next week, that process will have run its course and we should get some support. Today is just knee-jerk reactions.
The 11+ million figure is astounding to me. What would be a person's investment thesis for shorting this stock? Yet, perhaps the nearly 10 days to cover will give us a nice bounce in the coming days. Still, it boggles my mind that anyone would short a 10% payer with known near-term catalysts.
No surprise here. They said this is what they wanted to do and the environment was ripe to get it done. I am interested in better understanding the economics, but on the surface, if it is accretive to cash v. without the deal, it is beneficial. Hope they keep trading halted until the market opens in the morning so there can't be any silliness on low volume. More secure distribution should mean a nice pop in stock in time. GLTA
So long as the environment remains constructive for LINE to deliver on their strategy and the business continues to develop favorably, I am comfortable just enjoying my monthly distributions regardless of stock price gyrations. However, I must admit that I can't help but scratch my head at the level of short interest in this stock. I am not against shorting stocks and do at times, but shorting this stock today is about as dumb as investing gets IMO.
I do not understand it and that's why I added LNCO to my holdings when it dropped to $26 a while back. It seems to me they should be trading in a much closer proximity to each other and that LNCO is the better buy at the moment. The only reasons LNCO would trade less than LINE would seem to me to be 1) tax implications, 2) BRY sellers and 3) general composition of holders. My impression, perhaps wrong, is that LNCO is held by more professionals while LINE is held by more retail holders. The pros may be slower to get back into a stock with a sordid recent history.
Not uncommon to see a stock retreat after announcing a big deal and going into a quiet period. In this case, there is the backdrop of political grandstanding about inversions in general (though I doubt anyone really thinks Congress will act before this deal is done). Still, we are not likely to go much higher (and may go lower) before the deal is done and the stock that gets put in the hands of those who don't want to hold it are flushed through. I did note Gonzalez said there would be a large stock buyback upon completing the deal. That said, I will add on any weakness because this will be a $70+ stock later in 2015 IMO.
I read it differently. First, this deal was no surprise, so I would expect some bought shares on the decline fully intending to sell them on the news. Second, you have to give the pros some time to understand the deal, re-run their models and decide what they want to do. It takes hours to days for this to happen. As for me, I consider it a gift and bought an additional 20,000 LNCO at $27.50 this morning. Not because I think the stock is going to soar, but because I believe the distribution if further secured, there remains another Permian transaction catalyst and over time the stock should move up. GLTA
I agree the distribution wasn't in jeopardy and less so now, but don't you think LINE is just sticking to their knitting in trading capital intensive, high decline assets for less capital intensive low decline assets while securing the distribution at the same time?
Who knows. If it's going up because of the split, it should correct because a split is meaningless in reality. The reason stocks tend to go up into and following splits is because they wouldn't split if they weren't confident in the business. I think AAPL is going up because a lot of people believe it's an $800+ stock once the iPhone 6 is released and perhaps closer to $1,000 if a couple of new exciting technologies are introduced and nobody wants to miss the run. Besides, where else can you put your money in tech right now with this much upside? The high growth, high P/E stocks are still at risk of their sell-off resuming and AAPL doesn't have that risk.