Some OPEC members are in a lot worse shape then the US oil and gas producers.
Hedgeye's Kevin Kaiser trying to get confirmation on chatter that CFO Kolja Rockov is facing financial difficulties and had to cancel an 8M house he was building.
My comment: Back in 2009 Aubrey McClendon the CEO of Chesapeake got $150 million in margin calls and all his stock was dumped on the market dropping the stock price very low. Maybe Line and LNCO are having the same thing happening. Also, when oil was still at $100 and the stock was still paying a good dividend it was very tempting to buy more stock on margin since the dividend more then paid the margin interest. Margin calls may be the reason the stock price decrease is worse for Linn then other oil companies.
Last fall while the stock was dropping I was on the phone with a broker and he mentioned that due to the high yield some investors who owned the stock on margin and they were now getting margin calls which then resulted in the stock being sold off to meet then. My other point is that this company is very well hedged in 2015 and reasonably well hedged in the early part of 2016.
If nobody was willing to sell then the share price would have gone sky high.
Today's Wall St. Journal has a big article on solanezumab saying the sales volume could be 3 billion $ if it gets approved. PDLI would be collecting royalties on all this for 11 years so our stock goes down but Lilly is flying high.
You are correct about one item. The Queen patents will expire at least a year before solanezumab could get approved. However, that has not stopped all the early stage bio stocks from having rising stock prices.
Has he made any comments recently ?
First:, Due to the large number of hedges that are in place LINE-LNCO will survive until 2017.
Many countries are begging Saudi Arabia to cut back production. If that should happen oil would go back to $100 overnight.
The 14% NGL can't be hedged because no contracts exist for this mixture. This makes the Linn hedging picture a bit worse then just the oil and gas numbers project.
I have worked in biotech (now retired) and I think that 1456 has the potential to be a blockbuster. However, nothing is sure.
Because of the high dividend a lot of investors bought this stock on margin because it looks like a free way to own more stock. Now they are getting margin calls.
The Lilly presentation is all over the TV but nobody connects it to PDLI.
Do the math: The Saudi's could sell 5 million barrels a day at $100 or 10 million BPD at $50. If the price goes to $30 barrel then dropping production to 5 million BPD would be more profitable.
Every molecule in an ADC requires a humanized antibody. These are difficult and expensive to make. The ECYT products use folic acid ( vitamin B9), a commercially available molecule that can be bought by the pound for a reasonable price. The sleeper improvement in going from 145 to 1456 is changing the linker to be more water soluble so the drug is eliminated by the kidneys not the liver. This is a good stock for people who like to gamble.