With the oil and gas industry and Wall Street, public sentiment changes quickly. After over 100 oil- and gas-related companies declared bankruptcy over the past two years, financial analysts are jumping back on the bandwagons of some of the companies emerging from bankruptcy.
A recent Barron’s article profiles six of these oil and gas companies that have come out of bankruptcy since last summer as value purchases. These companies are Linn Energy, Ultra Petroleum, SandRidge Energy, Halcon Resources, Midstates Petroleum and Goodrich Petroleum.
Barron’s was a consistent critic of the old Linn Energy. Now, Barron’s says the post-bankruptcy Linn Energy is much different and aims to be a growth-oriented exploration and production company rather than a yield play. Similarly, an analyst in the report states you can buy the SandRidge stock for less than the value of its proven reserves. However, prior shareholders received little or nothing in these new companies.
Aggrieved investors of the “old” companies remain, though, and their recovery may not be as quickly as these oil and gas companies.
Many of these companies were touted as high upside and fool-proof investments while Wall Street continued to issue more debt. That was during a time when oil was portrayed as an invincible commodity that its price would consistently rise. That was not true and never has been true.
The truth of the matter is that the price of oil dramatically decreased over the course of two years. Leading up to and during this period, many brokerage firms and brokers recommended their customers invest in these investments, touting them as low-risk, steady sources of income despite internal concerns to the contrary.
Linn Energy formerly was a darling of Wall Street, with many brokerage firm analysts cheering them on, including Raymond James. Now, less than two months after the company emerged from bankruptcy, analysts are again bullish on Linn Energy.
SandRidge Energy, prior to its bankruptcy, was heavily-saddled with debt. The oil and gas company declared bankruptcy in May 2016 with over $8.2 billion in debt, approximately $6.4 billion of that total unsecured. This is a company that many large firms underwrote, including Barclays, RBC Capital Markets, and Merrill Lynch.
The unsecured debt that these oil and gas companies has now been wiped clean, with many ordinary, mom-and-pop investors left holding the bill. If your broker or brokerage firm unsuitably recommended these oil and gas investments, you may be able to recover some or all of your losses.
FINRA arbitration is a fast, efficient way to recover your lost oil and gas investment funds. It provides a medium to recover for investors who were told to invest and may have been left with nothing following an oil and gas company’s bankruptcy. We work on a contingency fee basis, meaning you pay us nothing unless we win and recover money for you.
Our lawyers are experienced in recovering investor losses due to broker and brokerage firm misconduct through FINRA arbitration.
For more information about the law firms, the lawyers, and our oil and gas investment practice area, please visit our website at www.oilgasfinraarbitration.com. Contact Scott L. Silver at (800) 975-4345 for a free, confidential consultation.