Crude oil (WTI) is down 1.27% to $41.96 per barrel today, while Brent crude is lower by 0.63% to $48.88 per barrel, according to the CNBC.com index.
China's economic woes and its subsequent devaluation of the yuan continue to negatively impact oil prices, which are hovering around six-and-a-half year lows this afternoon, according to Reuters.
Further weighing down oil prices is an economic slowdown in Japan, the world's third largest oil consumer, Reuters noted. The country's economy contracted at an annualized pace of 1.6% for the 2015 second quarter.
LinnCo, based in Houston, Texas, acquires and develops oil and natural gas properties.
Separately, TheStreet Ratings team rates LINNCO LLC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LINNCO LLC (LNCO) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 69.2% when compared to the same quarter one year ago, falling from -$19.48 million to -$32.98 million.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, LINNCO LLC's return on equity significantly trails that of both the industry average and the S&P 500.
- Net operating cash flow has significantly decreased to $40.52 million or 56.53% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 89.41%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 73.33% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
- LNCO, with its very weak revenue results, has greatly underperformed against the industry average of 34.4%. Since the same quarter one year prior, revenues plummeted by 65.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- You can view the full analysis from the report here: LNCO Ratings Report