But aren't the acquisitions going to Quantum until they get their money back plus production profits? Then Linn will be allowed to buy whatever they can afford from Quantum. (I confess, however, that I don't want to read the deals again as I have no plans to hold Linn.) And with GSO Linn has a small percentage until GSO has recouped (with profit) in a somewhat similar deal. Surely Quantum and GSO aren't just giving money away for Linn's benefit. They'll certainly come first, any possible profits of significance for Linn will be 4 or 5 years away. Surely Quantum & Blackstone aren't charitable organizations. I'm not saying the deals are bad, especially for a cash- and credit-strapped firm like Linn, but re cash flow, Quantum and GSO certainly are making sure that they come first. For Linn the fruit from the deals are longer term. Meanwhile there's the big debt, low oil prices, and unattractive hedge rollovers.
GPD, I've been this way about LINE/LNCO since the low 20s, when I removed my horns and changed my name to Teddy. Think how many people would now be better off if they had done the same. So you do fail to mention that in the embrace of this consistency I've been right. Which (admittedly) will not win me a Miss Popularity trophy on a typical stock message board, the basic purpose of which is for posters to assure each other that they haven't made a mistake.
I credit you with having a unique take of market activity unfettered by empirical evidence (or any larger global context). Keep up the sound logic.
At this moment LINE is trading in the 8.70s (while WTI is at $51). Concurrently the two deals just closed by Linn are being misinterpreted as providing virtual instant cash and production for Linn because of the good-heartedness of two sophisticated, profit-oriented companies. And, finally, there is Linn's huge distribution which a number of longs interpret as opportunity rather than an alarm bell. These are siren songs and potential buyers would be well advised to tie themselves to the mast so they can't take action. LINE, despite those who are self-protectively optimistic, is a speculation that becomes increasingly dangerous.
It looks to me as if the only cash that'll come Linn's way is the relatively small amount from the Permian sale. I thought that Drillco and GSO Partners would be investing their money in acreage and then wells (managed by Linn), not giving it to Linn. The amount ultimately going to Linn will be pretty small compared to that going first to Drillco and GSO, neither of whom are spending their money as an altruistic gesture to Linn. It'll take a number of years for Linn to *possibly* benefit in a financially meaningful way, provided they haven't drowned in debt.by that time. Please correct me if I'm wrong.
Our financial system is fundamentally Hamiltonian capitalism. And without his drive, writing skills, and articulate argumentation, it's doubtful that we would have had the Constitution Convention at all. It's almost dizzying to consider that the states' representatives met to tweak the Articles of Confederation and wound up, in effect, driven by the engines of Hamilton and Madison wound up going so far beyond their brief that they, in effect, dumped the Articles of Confederation and created what would shortly become a whole new nation grounded on federalism and not confederation. Moreover once we got started with Washing as president, it was Hamilton, who had Washington's complete trust, who basically ran the first two administrations. He was a genius and a visionary capable of working effectively on a whole raft of new things and problems without faltering (women troubles aside). Meanwhile, Jefferson was doing his best (unsuccessfully) to undermine Hamilton with a backward-looking view that we should be an agrarian society and not an industrial one.
Shorts having to eventually come to the rescue with buying is a song that's been sung here since the 30s. Won't be much solace to longs if they buy back at 5.
Yes, you're being scammed, but it's self-inflicted. Here's a remedy that you are probably following based on your post:
When in danger,
When in doubt,
Run in circles,
Scream and shout!
Didn't like the premarket as I'd hoped for the 9s. Chose discretion over valor and bailed at 8.99. The trading has become treacherous. Sheesh!
I hope the market doesn't knock the "h" out of "whither" and convert it to "wither." Anyway, I didn't think that the 9.05 price would hold today the second time around but felt that a nice round "9" had a decent chance. So I placed a bargain-basement order for 5K in units at 8.91, never really expecting to get it but thinking if LINE actually broke through 9 there could be a panicky mini-blowoff, which is frequently followed by a recovery pop. After lunch I caught the last couple of trading minutes, and the price sure collapsed in a hurry. Maybe tomorrow's dist. declaration caused apprehension about a possible cut. If so, a last-minute dive could be a monthly event' barring a cut which removes that option from the table. I'm more inclined to think there'll be a return to today's general range in the low 9s, and that my unexpected 5K will produce many nickels (to Strobble's dismay I suppose). But the way things are now with Linn, holding overnight still gives me the heebie-jeebies. And it's the stock market, so one never knows, the exception being the here-today-gone-tomorrow posters who KNOW until they very quickly don't.
With WTI in the mid-59s I'm surprised that LINE (as I write this anyway) seems stalled in the very low 9s. It was holding so well at 9.05 that I bought 5K in units at 9.06 for my first day trade in almost two weeks. It moved up just a bit then slipped back down and scrambled up again. Too many sell-side headwinds though, and I bailed at 9.13. (Sorry Strobble, but I pocketed 7,000 nickels, and now I can't pull my pants up.) I'm guessing that LINE's lackluster performance of late may be telegraphing a less-than-stellar Q2.
Jerry, go back a week or two and read a bunch of posts. Ignore those that make simple-mind declarations of faith and find those that provide a reason or three about why Linn's fundamentals are very shaky. Also read the posts of optimistic longs, because a good investor always wants a variety of opinions, provided that they're accompanied by reasons. Even merely one that's sensible can be helpful. Give it some time, because you'll read lots of naïve nonsense and lots of stuff that's totally irrelevant. I think you'll find your answer then. And perhaps you'll conclude that the effort is something that should have preceded your purchase.
And you won't live forever either, Strobble. And are you reading the Saudi Oil Ministry's minds to determine they're panicking? If so, that's mighty impressive. Also, just who are the "They" and the "Some" that you refer to? And how can a forecasting body like the IEA perpetrate a scam re oil prices? Ever get the feeling that conspiracy theories interfere with objectivity? Have you ever considered the implications of Linn's debt and its possible relationship to the unit price?
Richard, with oil at $75 to $80 (which may yet turn out to be fantasy) Linn can survive with a large distribution cut. That'd make the 2020 bonds a promising buy and a strong income hold.
Funny stuff, Oliver. I bet that Norris has read your parody and fervently agrees with it.
Rem, you see "a lot of small blocks being traded" and assume that must mean day traders (and do you really mean day traders and not short-term traders?). I stopped day-trading LINE a couple of weeks ago, but you don't seem to understand those small blocks. When I'd order 5 to 6 thousand LINE units, always at a limit price, the trade would often be made in from 15 to as many as 25 small trades over a period of a minute or two to an hour or more. I'd pay one commission on my total 5 or 6K (or however much I could pick up), but you'd see it as umpteen tiny trades and draw your conclusions from that. Finally, I think your imagination has outpaced reality. Short-term traders who last don't drive prices down. They buy at a price and sell (to a willing buyer) at a higher price. If they functioned as you claim (which is a comfortable means, I think, to avoid learning about Linn's shaky fundamentals), they'd be consistently losing money and would simply drop out. Ultimately, you've presented an odd hypothesis with zero evidence to support it.
That's only 10% of the outstanding shares. Celgene has about 10 years to increase their stock ownership to 30%. . . should they choose. The stock will probably settle in the mid-50s because of the longer-term synergies involved. Sugarplum fantasies are a formula for losses.