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Investments on the LINE

According to an Associated Press report, "The ratings service said its revised outlook for Linn reflects the benefit of the addition of Berry's size, scale and low-decline, liquids-focused assets. But it added that Linn's aggressive pace of acquisitions boosts the risks related to the company."

Jim Cramer and Stephanie Link actively manage a real money portfolio for his charitable trust -- enjoy advance notice of every trade, full access to the portfolio, and deep coverage of the latest economic events and market movements.

Now the 2.42-billion-dollar question is how the shareholders of LINE and BRY will react to all these developments. A press release Friday stated that a Wayne, Pa., law firm is investigating potential claims against the board of directors of Berry Petroleum. The press release states the investigation concerns "...possible breaches of fiduciary duty and other violations of law related to the company's [BRY] efforts to sell the company to Linn Energy, LLC and Linn Co, LLC in a transaction valued at approximately $4.3 billion."

The press release doesn't explain where they come up with the figure of $4.3 billion. It concludes by saying, "Our investigation concerns possible breaches of fiduciary duty and other violations of law related to the approval of the transaction by the company's board of directors; in particular, whether the company undertook a fair process to obtain fair consideration for all shareholders of Berry Petroleum."

For more information regarding the investigation you can contact Ryan & Maniskas, LLP (Richard A. Maniskas, Esquire) toll-free at (877) 316-3218 or by email at All I know about this firm is Ryan & Maniskas, LLP is a national shareholder litigation firm.

Fundamentally, this deal looks very good for the future dividends of LINE and LNCO. If the deal goes through they'll be buying a company [BRY] that in the trailing 12 months generated over $955 million in revenue. BRY steps into the earnings confessional on Thursday and the earnings conference call should be the highlight of the day.

Analysts' consensus estimate for EPS is that BRY will report around 7 cents per share in the latest quarter. This is only one cent higher than the year-ago quarter. Sales growth and revenue estimates for the fourth quarter of 2012 are around $253 million, which would equal a shining 11% increase over the same quarter in 2011.

Let's see a five-year chart of BRY's share price and quarterly per share revenue.

BRY Chart BRY data by YCharts
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LNCO $3.28 6.80%
LINE $3.29 3.10%
BRY $0.00 0.00%
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FB $91.68 -1.20%


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