I'm not. As LINE gets closer to the ex-dividend date and closure of the Berry acquisition, the shorts will be running for the exits.
If the Obama administration approves the LNG terminals, which should happen relatively soon, the suppliers of natural gas are going to benefit via higher prices and a greater reason to produce natural gas.
That's what Kinder Morgan did when it created KMI, which is analogous to LNCO.
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.
val, I think it is just a matter of time before the stock sees $40 again. I'd say give it a little over 30 days--around the June 21, 2013 options expiration.
I think raybans2 is right. Book value should be the bottom.
This move, quite frankly, is totally illogical. The Fed getting out of the bond buying business would be a GOOD thing for the REITs.
All we heard for months was how bad QE3 was for the REITs because the Fed's bond buying program kept rates artificially low and created an environment where (1) early redemptions could become a problem as lower rates gave people the opportunity to re-finance; and (2) the interest rate curve was flat, which made it more difficult for the REITs to make money.
The fact that the Feds are planning an exit strategy would be bullish for the REITs. It eliminates the REITs main competitor--the Fed.
There have been enough positive and detailed arguments to the contrary, e.g. Seeking Alpha, Motley Fool, etc., that those who have a bias to the long side feel comfortable getting back in at these depressed prices now that LINE has stabilized. Lack of volatility doesn't make for very good short trades.
The funny thing about the criticism of the hedges is that analysts have been touting them for years as a positive for LINE. The theory was simple. If natural gas is selling at $3 and you've got the price locked in to sell natural gas at $5, then the only thing that would make it a bad deal is if the price of natural gas rises above the $5 hedged price. At that point, you're selling below market.
Before XTO aka Cross Timbers Oil was acquired by Exxon, they used to the same thing--albeit to a lesser extent. XTO generally hedged a smaller percentage of their natural gas, so that if there was an uptick in the market, they could capture larger returns.
Anyway, I agree that talking parrots don't make for good financial advice.
Of course that sometimes happens, but in this particular situation, I don't believe that's the case.
I went over to the NASDAQ website and used their interactive one day chart. If you look at the volume for 11:26 a.m., it was 100,865 shares at around $34.50. There was one order I specifically recall for 25,865, which corresponds. At 11:27 a.m., 58,238 shares changed hands. I believe there was another order for some oddball number at $34.50--something like 20, 38 or 21,238.
Those were the highest volume levels of the day, which was shortly before I posted.
navkram, on level 2, I'm seeing big block buy orders at $34.50--$20,000 & $25,000+ share orders. That has to be institutional buying. That's probably a good indication of where the bottom may be.
First, it's not unusual for any stock after the ex-dividend date to retreat.
Second, the stock should appreciate after the Berry Petroleum acquisition formally closes. The same thing happened to ETP when it acquired Sunoco. Once the deal was finalized, ETP shot up from $41 to $50 in just a few short months.
Third, the old Warren Buffett adage comes to mine "Be fearful when others are greedy. Be greedy when others are fearful.” Obviously, Barron's has managed to create fear, which is largely unsubstantiated. However, this too will pass.
Well, with the reductions in estimated EPS by analysts earlier in the quarter, WIN is now poised to meet or beat expectations when earnings are announced. In my view, that's the catalyst for the upward move today.
Shorts have made money and want to preserve some of those profits. I suspect that when the stock hits the $8.90 resistance level, they will reinitiate short positions.