3 Things to Watch When LINN Energy LLC (LINE) Reports

This means that the company will be able to economically produce more oil and gas from its existing asset base than was previously estimated. It also means that the income from wells won’t run dry as fast as previously thought, which is a great help to the company as it continues to pay and grow its distribution.

My Foolish take
Look for LINN’s distribution coverage ratio to be slightly above 1.1 times. Commodity prices were a bit higher than the company’s guidance forecasts, which means that it likely made a bit more money selling its oil and gas in the quarter. What’s not likely is any mention of a distribution increase; the company just announced a static payout last month. Instead, look for a bump up in the company’s capex budget, probably to over a billion dollars in the year ahead. Finally, make sure LINN was able to replace more than 100% of its production outside of the reserves added by acquisition. LINN energy investors should continue to do well as long as the company’s answers to these three questions are in the same vicinity as my forecasts.

The article 3 Things to Watch When LINN Energy Reports originally appeared on Fool.com and is written by Matt DiLallo.

Fool contributor Matt DiLallo owns shares of Enterprise Products Partners L.P., LINN Energy, LLC, and LinnCo, LLC. The Motley Fool recommends Enterprise Products Partners L.P.

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