Linn Energy LLC (LINE)


LINE has been a wild ride in 2013. There was an inquiry from the SEC about their accounting practices relative to hedging and distributabl cash flow. Linn was not required to publicly disclose the inquiry, but they chose to do so. While the inquiry eventually went away with no penalties, the months-long overhang gave an opening for a short attack and much negative press.

There's also a merger with Berry Petroleum in the works. This initially had some positive 'pop' on the stock price, but rolled in with the negative press LINE eventually had to bump up the offer multiple due to lowered stock price. I am still of the opinion that the merger is a good deal, if not a smoking one. Due to close in January 2014.

LINE pays monthly distributions (dividend-like), which is handy for income.

I bought in to LINE in April 2012 at $38.24. During the worst of the negative press, I tried to 'time the bottom' and bought some more at $29.14. I missed the bottom by a fair amount, as the 52 week range is $20.35 - $39.50. Today (December 2013) it's trading right around $30, and I'm sitting on a paper loss of 18.75%. It is still throwing off high yields, currently 9.65%, and analysts are predicting it will be in the $34 range in 2014, so I'm in for the long term.


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