Linn Energy LLC (LINE): Why I’m Buying This Embattled Energy Company

The only way you can get value for Linn Energy LLC (NASDAQ:LINE) anywhere near where short-sellers have it pegged is if natural gas prices stay at last year’s depressed prices… forever. Seeing how natural gas prices are already substantially higher, with potential future demand drivers coming from electrical generation, exports, and natural gas vehicles, I think it’s safe to say that there is a lot more value in LINN’s asset base than the shorts give it credit for.

My trade
While I already own units of Linn Energy LLC (NASDAQ:LINE) and shares of LinnCo LLC (NASDAQ:LNCO), both combined make up less than 2% of my well-diversified portfolio. That’s why I plan to buy shares and write puts striking at $20 on both companies to bring my overall exposure up to 5% of my portfolio. I feel very strongly that the attacks on LINN are unjustified and that its real value will eventually win out.

The article Why I’m Buying This Embattled Energy Company originally appeared on Fool.com and is written by Matt DiLallo.

Fool contributor Matt DiLallo owns shares of LINN Energy, LLC and LinnCo, LLC. The Motley Fool has no position in any of the stocks mentioned.

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