Photo credit: LINN Energy.

Investing in energy is fraught with risk. Whether it's commodity price volatility, political posturing, or operational missteps, a lot can and does go wrong when investing in oil and gas production. LINN Energy (LINEQ) was formed as a different kind of oil and natural gas company. Instead of risking investor capital on exploration, LINN has focused instead on buying mature producing assets and operating them for maximum cash flow. It locks in that cash flow by hedging all of its production several years in advance.

In doing so, LINN Energy has mitigated both exploration risk and commodity price volatility and has become an income-producing machine. However, it has also drawn the attention of those who think this is a company not worth owning and should be shorted instead. With all of the noise, is LINN Energy even worth owning? Let's take a look at three reasons why investors might want to consider jettisoning LINN from their portfolio.

Reason to sell No. 1: Headache reliever
Some stocks simply aren't worth owning because the headaches aren't worth it. At its core, LINN buys mature oil and gas wells, hedges the production out a few years, and sends its investors the income from this process each month. It should be a buy-and-forget stock, but it has now become a battleground stock that has many investors concerned. If keeping up with LINN is causing pain, then just press sell and walk away as there are plenty of rock-solid dividend stocks to own instead. In fact, at the conclusion of this article is a link to a free report with our top nine income stocks.

Reason to sell No. 2: Informal SEC inquiry
LINN's hedging program has recently come under scrutiny, first by an independent research company and more recently by the SEC. It's that informal SEC inquiry into its accounting practices, hedging strategy, and complex merger with affiliate LinnCo (NASDAQ: LNCO) for Berry Petroleum (NYSE: BRY) that has many investors concerned. In fact, this is the one event that caused Jim Cramer to take a step back and recommend selling.

Investors have had to endure several months of relative silence from LINN on the matter. The company has filed amendment  No. 4 to its Registration Statement on Form S-4 in regards to the LinnCo/Berry merger. Further, the record date for the respective unitholder and shareholder meeting has come and gone with no further updates. While both it and Berry remain committed to the deal, it's still anyone's guess if that deal will ever close. Each passing day of no resolution to the situation is enough for some investors to grow tired of the situation and decide that it's not worth owning LINN.

Reason to sell No. 3: Operational missteps
The headache-inducing negative articles and informal SEC inquiry are only part of LINN's problems this year. Its other issue is that the company has had several operational missteps including its inability to cover its distribution as well as missing its own guidance.

One of the roots of its problems is that several of its Texas Hogshooter wells underperformed expectations in the first quarter. Not only did this impact its returns but it forced the company to shift its focus. LINN simply hasn't been able to drill its way out of its problems.

This is in contrast to BreitBurn Energy Partners (BBEPQ), which on the other hand, was able to drill its way out of its problems earlier this year. The company had a similarly disappointing first quarter, yet was able to make up for it with an exceptionally strong second quarter where the company grew higher-margin liquids production by 58% over the previous year, while overall production grew by 26%. BreitBurn's oil-focused drilling program delivered in ways that LINN's more balanced approach couldn't.

Investor takeaway
I personally own shares of both LINN and LinnCo and plan on doing so for many years. In fact, I recently outlined three reasons to buy LINN. That being said, it is important to see the other side of the story and there are three very legitimate reasons why investors would want to sell. So, for investors who have had enough of LINN and want out or even those who just want some other income options, I'd encourage you to take a look at the following free report on some of the most rock-solid dividend stocks available these days.