Linn Energy CEO Interview
Cramer spoke with CEO Michael Linn of Linn Energy (LINE) about why the stock has fallen so much since he recommended shares on October 2. Cramer explained that LINE was hurt by the demise of Lehman Brothers (LEHMQ) which was LINN’s largest shareholder and its banker. Lehman’s failure forced the firm to liquidate large amounts of the company’s stock. Linn explained that the liquidation did hit their share price, but it didn’t affect their operations. He explained that their hedged production was just re-hedged with other banks. He said Lehman owes the company $68 million for those hedges. Linn says the company is now hedged 10% against natural gas through 2010 and oil through 2011. He also pointed out the 17% dividend yield is safe. “With Linn guaranteeing the dividend, and the stock of a strong company only down because of the Lehman collapse, not any legitimate problem with the business, I think this stock should be bought,” Cramer said. Join the fastest growing community of small cap investors at Stockhideout.com
Leave a Response
