das555's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.com/user/190947/comments http://seekingalpha.com/article/1428501/comments?source=feed#comment-18997591 18997591 As there seems always to be a fair amount of confusion regarding MLP taxation principles I suggest a visit to the National Association of Publicly Traded Partnerships http://bit.ly/yb1qPX.
And of course there is LNCO for those allergic to complexity...]]> Sun, 19 May 2013 12:02:59 -0400 As there seems always to be a fair amount of confusion regarding MLP taxation principles I suggest a visit to the National Association of Publicly Traded Partnerships http://bit.ly/yb1qPX.
And of course there is LNCO for those allergic to complexity...]]> http://seekingalpha.com/article/1428501/comments?source=feed#comment-18987531 18987531 Sat, 18 May 2013 16:17:26 -0400 http://seekingalpha.com/article/1428501/comments?source=feed#comment-18961071 18961071 http://seekingalpha.co.... Pays your money and takes your choice... ]]> Fri, 17 May 2013 16:35:25 -0400 http://seekingalpha.co.... Pays your money and takes your choice... ]]> http://seekingalpha.com/currents/post/1000171?source=feed#comment-18506181 18506181 Mon, 06 May 2013 16:11:57 -0400 http://seekingalpha.com/currents/post/1000171?source=feed#comment-18500111 18500111 "

To the Editor:

Is Andrew Bary in the pocket of the Linn shorts? Does anybody at Barron's edit his work before it is published? Here are some reasons why, in my opinion, the answers to these questions seem to be, respectively, yes and no.

Mr. Bary's latest specious smear piece on Linn ("Twilight of a Stock Market Darling, May 6, 2013) raises many questions about whether Mr. Bary--and, indeed, Barron's--ought to be viewed as credible. Here are a few:

1. Mr Bary starts his article by saying that Linn's units "may" be worth less than the market price. To say that the units "may" be overvalued is to say nothing at all. They also "may" be worth more than the market price.

2. But that lapse in logic pales by comparison to that contained in Mr. Bary's next paragraph. Apparently disappointed that his prior attack on Linn didn't cause the collapse of its unit price, Mr. Bary actually attributes Linn's unit price sustainability to the claim that Linn's investor base mistakenly believe that Linn is a midstream, rather than an upstream, MLP. That allegation is obviously unsubstantiated and patently incapable of substantiation. By the way, in my experience and from reading relevant comments on Seeking Alpha, Linn's investor base appears more sophisticated than Mr Bary or his editors.

3. Mr. Bary also sees dire consequences because in one quarter with serious winter weather problems incurred by many exploration and production companies, not just Linn, distributable cash flow was less than its distribution, although its annual distributions (including the contemplated increase in Linn's distribution) is projected to be more than covered by distributable cash flow. There are scores of MLPs which often have a quarter in which exogenous events cause distributable cash flow to fall below their quarterly distributions only to have the distribution covered annually.

4. Mr. Bary next attacks Linn's production, but look carefully at how he does so. Because of the winter weather issues Linn's first quarter production was 796 mmcf/d, which Mr. Bary trumpets was "down" from the 800 mmcf/d in the 4th quarter of 2012. The difference between the 800 mmcf/d in the 4th quarter of 2012 and the 796 mmcf/d in the storm ridden first quarter of 2013 is so small and the result of the inclement weather that it hardly seems the making of a trend, much less a disaster. Yet when comparing the 796 mmcf/d in that first quarter with the 782 mmcf/d in the third quarter of 2012 Mr. Bary says that this improvement (which is more than 300% greater than the miniscule shortfall in the stormy first quarter)is "little changed".

5. Mr. Bary then points out that under GAAP accounting Linn habitually loses money. But so do many--if not the vast majority of-- -MLPs. Nobody who is a serious MLP investor looks at the GAAP earning of limited partnerships. For upstream companies like Linn, GAAP accounting is distorted by heavy depletion and intangible drilling cost write-offs. Mr. Bary ignores these inconvenient facts. In fact he never even mentions the words "depletion" or "intangible drilling costs".

6. Mr. Bary then re-visits the derivative accounting issues raised in his prior negative article, and once again he fails to note that Linn's accounting for distributable cash flow is based upon the very same rules required by the Financial Accounting Standards Board in accounting for derivatives for GAAP earning purposes. This is a meaningful omission.

7. Mr. Bary relies for his thesis on hedge fund analysts and principals quoted in the article. Another serious omission is a disclosure of whether these sources are or have been short Linn and, if so, the extent of their short position. It is hard to give much weight to the Hedgeye allegation that Linn, which has a $2.90 distribution even before its contemplated increase post- Berry acquisition, is only worth between $5.48 and $18.17 and a likely inference is that Hedgeye or its clients have a short position in Linn.

8. Finally, it makes little sense for Mr. Bary to compare Linn to the major integrated slower-growth companies such as Exxon Mobil and Chevron or even to exploration and production companies such as Newfield or Devon. Linn, as an LLC considered for income tax purposes as an MLP, is not a taxable entity. Pass-through entities such as MLPs have a lower cost of capital than C corporations. Linn's distributions to unit holders are tax deferred. Linn's yield has been consistently orders of magnitude higher than the C corporations to which Mr. Bary and his hedge fund sources compare it."]]> Mon, 06 May 2013 13:49:17 -0400 "

To the Editor:

Is Andrew Bary in the pocket of the Linn shorts? Does anybody at Barron's edit his work before it is published? Here are some reasons why, in my opinion, the answers to these questions seem to be, respectively, yes and no.

Mr. Bary's latest specious smear piece on Linn ("Twilight of a Stock Market Darling, May 6, 2013) raises many questions about whether Mr. Bary--and, indeed, Barron's--ought to be viewed as credible. Here are a few:

1. Mr Bary starts his article by saying that Linn's units "may" be worth less than the market price. To say that the units "may" be overvalued is to say nothing at all. They also "may" be worth more than the market price.

2. But that lapse in logic pales by comparison to that contained in Mr. Bary's next paragraph. Apparently disappointed that his prior attack on Linn didn't cause the collapse of its unit price, Mr. Bary actually attributes Linn's unit price sustainability to the claim that Linn's investor base mistakenly believe that Linn is a midstream, rather than an upstream, MLP. That allegation is obviously unsubstantiated and patently incapable of substantiation. By the way, in my experience and from reading relevant comments on Seeking Alpha, Linn's investor base appears more sophisticated than Mr Bary or his editors.

3. Mr. Bary also sees dire consequences because in one quarter with serious winter weather problems incurred by many exploration and production companies, not just Linn, distributable cash flow was less than its distribution, although its annual distributions (including the contemplated increase in Linn's distribution) is projected to be more than covered by distributable cash flow. There are scores of MLPs which often have a quarter in which exogenous events cause distributable cash flow to fall below their quarterly distributions only to have the distribution covered annually.

4. Mr. Bary next attacks Linn's production, but look carefully at how he does so. Because of the winter weather issues Linn's first quarter production was 796 mmcf/d, which Mr. Bary trumpets was "down" from the 800 mmcf/d in the 4th quarter of 2012. The difference between the 800 mmcf/d in the 4th quarter of 2012 and the 796 mmcf/d in the storm ridden first quarter of 2013 is so small and the result of the inclement weather that it hardly seems the making of a trend, much less a disaster. Yet when comparing the 796 mmcf/d in that first quarter with the 782 mmcf/d in the third quarter of 2012 Mr. Bary says that this improvement (which is more than 300% greater than the miniscule shortfall in the stormy first quarter)is "little changed".

5. Mr. Bary then points out that under GAAP accounting Linn habitually loses money. But so do many--if not the vast majority of-- -MLPs. Nobody who is a serious MLP investor looks at the GAAP earning of limited partnerships. For upstream companies like Linn, GAAP accounting is distorted by heavy depletion and intangible drilling cost write-offs. Mr. Bary ignores these inconvenient facts. In fact he never even mentions the words "depletion" or "intangible drilling costs".

6. Mr. Bary then re-visits the derivative accounting issues raised in his prior negative article, and once again he fails to note that Linn's accounting for distributable cash flow is based upon the very same rules required by the Financial Accounting Standards Board in accounting for derivatives for GAAP earning purposes. This is a meaningful omission.

7. Mr. Bary relies for his thesis on hedge fund analysts and principals quoted in the article. Another serious omission is a disclosure of whether these sources are or have been short Linn and, if so, the extent of their short position. It is hard to give much weight to the Hedgeye allegation that Linn, which has a $2.90 distribution even before its contemplated increase post- Berry acquisition, is only worth between $5.48 and $18.17 and a likely inference is that Hedgeye or its clients have a short position in Linn.

8. Finally, it makes little sense for Mr. Bary to compare Linn to the major integrated slower-growth companies such as Exxon Mobil and Chevron or even to exploration and production companies such as Newfield or Devon. Linn, as an LLC considered for income tax purposes as an MLP, is not a taxable entity. Pass-through entities such as MLPs have a lower cost of capital than C corporations. Linn's distributions to unit holders are tax deferred. Linn's yield has been consistently orders of magnitude higher than the C corporations to which Mr. Bary and his hedge fund sources compare it."]]> http://seekingalpha.com/article/1327371/comments?source=feed#comment-17367641 17367641 Mon, 08 Apr 2013 15:06:10 -0400 http://seekingalpha.com/article/1327371/comments?source=feed#comment-17363031 17363031 http://seekingalpha.co...]]> Mon, 08 Apr 2013 13:27:53 -0400 http://seekingalpha.co...]]> http://seekingalpha.com/article/1314061/comments?source=feed#comment-17123511 17123511 The holdings may have value but the management can not be trusted and in fact should be reviled for their lack of candor. Holding AT is likely holding a false hope. Mistakes can be made, but purposeful deception cannot be exonerated.]]> Tue, 02 Apr 2013 14:31:24 -0400 The holdings may have value but the management can not be trusted and in fact should be reviled for their lack of candor. Holding AT is likely holding a false hope. Mistakes can be made, but purposeful deception cannot be exonerated.]]> http://seekingalpha.com/currents/post/912851?source=feed#comment-16897351 16897351 Wed, 27 Mar 2013 16:15:24 -0400 http://seekingalpha.com/currents/post/911271?source=feed#comment-16851511 16851511 The share issuance is a relatively inexpensive capital acquisition tool with which to expand the underlying business and thereby distributable cash flow. It is often misperceived as "dilution" which it would only be if the MLP had poor management that did not use the capital for accretive purposes.]]> Tue, 26 Mar 2013 19:07:34 -0400 The share issuance is a relatively inexpensive capital acquisition tool with which to expand the underlying business and thereby distributable cash flow. It is often misperceived as "dilution" which it would only be if the MLP had poor management that did not use the capital for accretive purposes.]]> http://seekingalpha.com/currents/post/906371?source=feed#comment-16743881 16743881 * I think myself that we have more machinery of government than is necessary, too many parasites living on the labor of the industrious.]]> Sun, 24 Mar 2013 18:06:38 -0400 * I think myself that we have more machinery of government than is necessary, too many parasites living on the labor of the industrious.]]> http://seekingalpha.com/article/1257191/comments?source=feed#comment-16578061 16578061 Wed, 20 Mar 2013 19:26:31 -0400 http://seekingalpha.com/article/1290241/comments?source=feed#comment-16574151 16574151 Wed, 20 Mar 2013 18:14:03 -0400 http://seekingalpha.com/currents/post/892981?source=feed#comment-16440311 16440311 Mon, 18 Mar 2013 11:29:53 -0400 http://seekingalpha.com/article/1068501/comments?source=feed#comment-16404551 16404551 Sun, 17 Mar 2013 14:14:37 -0400 http://seekingalpha.com/article/1276591/comments?source=feed#comment-16404501 16404501 I suspect that the return of capital equity CEFs have not been significantly purchased as a result of their more complex nature involving financial manipulations and leverage which are not well understood by the average investor. The application of these financial levers and wires to an equity while increasing returns would seem to provide an opportunity for the generation of financial smoke and mirrors as well as chicanery by the humans creating these equity instruments which in the past has often led to significant financial losses for the unsophisticated holders seeking higher yields. ]]> Sun, 17 Mar 2013 14:13:05 -0400 I suspect that the return of capital equity CEFs have not been significantly purchased as a result of their more complex nature involving financial manipulations and leverage which are not well understood by the average investor. The application of these financial levers and wires to an equity while increasing returns would seem to provide an opportunity for the generation of financial smoke and mirrors as well as chicanery by the humans creating these equity instruments which in the past has often led to significant financial losses for the unsophisticated holders seeking higher yields. ]]> http://seekingalpha.com/article/1257191/comments?source=feed#comment-16067321 16067321 Sat, 09 Mar 2013 08:10:34 -0500 http://seekingalpha.com/article/1243561/comments?source=feed#comment-15876171 15876171 Poor decision: Raising the dividend with the contracts expiring that provided a major share of DCF.
Poor decision: stating the management's confidence in AT's ability to sustain the dividend despite the expiring contracts.
The market has spoken as to the managements success in running their business and as to the trust placed in the management.

BTW I listen to every conference call and read all SEC submissions on stocks I own. This data was hidden as the author points out.

You win some and you lose some but you play the game correctly and by the rules.

Easy to have 20/20 hindsight and to misdirect responsibility for losses to the loser.

I am out of AT but have no real lessons learned other than occasionally it is a rigged game.]]> Tue, 05 Mar 2013 15:03:18 -0500 Poor decision: Raising the dividend with the contracts expiring that provided a major share of DCF.
Poor decision: stating the management's confidence in AT's ability to sustain the dividend despite the expiring contracts.
The market has spoken as to the managements success in running their business and as to the trust placed in the management.

BTW I listen to every conference call and read all SEC submissions on stocks I own. This data was hidden as the author points out.

You win some and you lose some but you play the game correctly and by the rules.

Easy to have 20/20 hindsight and to misdirect responsibility for losses to the loser.

I am out of AT but have no real lessons learned other than occasionally it is a rigged game.]]> http://seekingalpha.com/article/1243561/comments?source=feed#comment-15809141 15809141 Move with the herd and you will be safe?
AT for the past 8 - 10 years had been a reliable payer of high yields and the big price swings have been relatively recent due to corporate acquisitions and a changing business model that was distrusted by some who sold but trusted by others who had had previous good experience with this management team. It now turns out that the management team was in fact making poor recent decisions and was not providing investors with up front clarity on the company's status. I believe this obfuscation by management was the true cause of the difficulty in assessing AT and that this was not a case of you should have known and should have avoided the stock simply because it yielded 9%. Retrospective decision making is easy and not very useful.]]> Mon, 04 Mar 2013 13:25:45 -0500 Move with the herd and you will be safe?
AT for the past 8 - 10 years had been a reliable payer of high yields and the big price swings have been relatively recent due to corporate acquisitions and a changing business model that was distrusted by some who sold but trusted by others who had had previous good experience with this management team. It now turns out that the management team was in fact making poor recent decisions and was not providing investors with up front clarity on the company's status. I believe this obfuscation by management was the true cause of the difficulty in assessing AT and that this was not a case of you should have known and should have avoided the stock simply because it yielded 9%. Retrospective decision making is easy and not very useful.]]> http://seekingalpha.com/article/1151851/comments?source=feed#comment-15714841 15714841 Fri, 01 Mar 2013 20:02:47 -0500 http://seekingalpha.com/article/1241031/comments?source=feed#comment-15706391 15706391 Fri, 01 Mar 2013 16:13:15 -0500 http://seekingalpha.com/article/1151851/comments?source=feed#comment-15661921 15661921 Thu, 28 Feb 2013 19:21:39 -0500 http://seekingalpha.com/article/1181611/comments?source=feed#comment-14954131 14954131 Wed, 13 Feb 2013 17:20:28 -0500 http://seekingalpha.com/currents/post/824891?source=feed#comment-14946601 14946601 Wed, 13 Feb 2013 14:43:54 -0500 http://seekingalpha.com/article/1151851/comments?source=feed#comment-14498791 14498791
Rough Math:

Lost Annual Revenue: Auburndale 11% = 20.35 million $
Lake 10% = 18.5 million $
Total = 38.85 million $
New Revenues (from above article - minimum):
Piedmont: 8 million $
Canadian Hills: 16 million $
Orlando: 14 million $
Total New Revenue (minimum estimate): 38 million $

Rough math not too bad.
]]> Sat, 02 Feb 2013 23:32:28 -0500
Rough Math:

Lost Annual Revenue: Auburndale 11% = 20.35 million $
Lake 10% = 18.5 million $
Total = 38.85 million $
New Revenues (from above article - minimum):
Piedmont: 8 million $
Canadian Hills: 16 million $
Orlando: 14 million $
Total New Revenue (minimum estimate): 38 million $

Rough math not too bad.
]]> http://seekingalpha.com/article/1151851/comments?source=feed#comment-14487631 14487631 One can only conclude that either they did not foresee the effects of their significant revenue generating asset sale announcement, which suggests poor judgement, or they feel the dividend is indeed at jeopardy and their silence is announcing this unpleasant fact.
Nether possibility leads one to be happy in the ownership of the company.]]> Sat, 02 Feb 2013 13:41:34 -0500 One can only conclude that either they did not foresee the effects of their significant revenue generating asset sale announcement, which suggests poor judgement, or they feel the dividend is indeed at jeopardy and their silence is announcing this unpleasant fact.
Nether possibility leads one to be happy in the ownership of the company.]]> http://seekingalpha.com/article/1127501/comments?source=feed#comment-14106291 14106291 Thu, 24 Jan 2013 13:01:00 -0500 http://seekingalpha.com/currents/post/715631?source=feed#comment-12520851 12520851 Wed, 12 Dec 2012 10:55:20 -0500 http://seekingalpha.com/article/1031571/comments?source=feed#comment-12082781 12082781 Thu, 29 Nov 2012 14:35:20 -0500 http://seekingalpha.com/currents/post/671981?source=feed#comment-11702361 11702361 Fri, 16 Nov 2012 17:10:57 -0500