Linn Energy (LINE) Rallying on Cramer Recommendation

On last night's Mad Money, Jim Cramer welcomed Linn Energy's (Nasdaq: LINE) Chairman and CEO, Michael Linn, to his CNBC show.

Cramer and Linn discussed the failure of Lehman Brothers (NYSE: LEH), which was previously Linn Energy's largest shareholder. When the bank collapsed, shares of Linn were immediately liquidated, causing a slide from over $19 to a new 52-week low of $10.90 in about a month.

Michael Linn points out that while shares of Linn were damaged, its operations remain strong and the company has already undertaken new hedges with other banks. Concluding the skit, Cramer called Linn "a perfect example of a broken stock and not a broken company. Cramer sees Linn Energy as a play on capital preservation, given its nearly 16% dividend yield and $100 million buyback still in the pipeline.

Shares of Linn are surging today on the Cramer recommendation. The stock has opened trading about 10% higher this morning, and is notably bucking the broader trend across energy. Energy stocks are feeling pressure today following several days of upside and weak earnings out of metals bellweather Freeport-McMoRan (NYSE: FCX).

Linn Energy, LLC, through its subsidiaries, engages in the development and acquisition of gas and oil properties in the United States.

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