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Linn Energy LLC (LINE), Chipotle Mexican Grill, Inc. (CMG): This Week’s 5 Dumbest Stock Moves

Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let’s take a look at five dumb financial events this week that may make your head spin.


1. Frank LINN

Linn Energy LLC (NASDAQ:LINE) took a hit after revealing that the SEC is launching an inquiry into the company’s hedging strategies, accounting metrics, and the proposed purchase of Berry Petroleum.

Linn Energy LLC (NASDAQ:LINE)’s been a serial acquirer. It’s been snapping up smaller oil and natural gas providers in this highly fragmented sector. Linn Energy LLC (NASDAQ:LINE) racked up $2.9 billion in purchases last year alone and the Berry deal would put it well above that in 2013.

Accounting can get tricky as companies go on buying sprees, but investors tend to steer clear once regulators start launching investigations.

The silver lining for daring income chasers is that Linn Energy LLC (NASDAQ:LINE)’s yield just got ridiculously juicy. It declared a monthly cash distribution this week that translates into an annualized yield of 12.7% on the units based on Wednesday’s close.

The fear here, naturally, is that the payouts on the units won’t be sustainable if the SEC’s inquiry nails Linn Energy LLC (NASDAQ:LINE).

2. Brake fast at Tiffany & Co. (NYSE:TIF)’s

You don’t often see too many company executives doubling as jewel thieves, but that’s just what reportedly happened at Tiffany & Co. (NYSE:TIF).

Ingrid Lederhaas-Okun — a vice president at the upscale retailer until being dismissed in a corporate downsizing earlier this year — was arrested and charged with stealing more than 165 pieces of jewelry valued at more than $1.2 million.

The thefts reportedly took place during the four months leading to her dismissal. She then went on to sell the jewelry.

Given that Tiffany & Co. (NYSE:TIF) is a high-end jewelry retailer, one would think that it should have caught this sooner.

3. A penne for your thoughts

Noodles & Co (NASDAQ:NDLS) has become an IPO sensation, soaring 165% since going public at $17 a week ago.

This is naturally good news for the health of the IPO market and a testament to the popularity of fast casual dining, but investors calling this the second coming of Chipotle Mexican Grill, Inc. (NYSE:CMG) may want to revisit their assessments.

Noodles & Co (NASDAQ:NDLS) closed at $45 on Wednesday, which happens to be exactly where Chipotle Mexican Grill, Inc. (NYSE:CMG) opened on its first trade after more than doubling at the open more than seven years ago.

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