What Should You Look for in Linn Energy's Earnings

The following video is from Thursday's Digging for Value, in which host Alison Southwick, Motley Fool analyst Joel South and Fool.com contributor Tyler Crowe dive deep into the top stories for today's energy sector investors.The twice-weekly show can be viewed on Tuesdays and Thursdays. It can also be found on Twitter, along with our extended coverage of the energy and materials sectors: @TMFEnergy.

For investors who may be interested in Linn Energy's (NASDAQ: LINE  ) upcoming quarterly results, there is one important metric you should look at, and it's not earnings. Since Linn and its master limited partnership peers Breitburn Energy Partners (NASDAQ: BBEP  ) and Vanguard Natural Resources (NASDAQ: VNR  ) return almost all of their distributable cash flow back to shareholders, the real metric you should look at is the coverage ratio -- a metric that compares how much cash flow the company takes in compared to how much it pays out. In this segment, Tyler discusses why this metric is important to Linn, Breitburn, and Vanguard, and he discusses some of the long-term items investors should look at.

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