TSO: Tesoro Petroleum Corp. Message Board

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Gold/Mining/Energy : TSO: Tesoro Petroleum Corp.

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From: Dennis Roth	10/26/2007 11:46:46 AM
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Tesoro Corp. (TSO): Tracinda offer bullish for Tesoro, refiners News Tracinda Corporation announced this morning that it intends to make an offer to tender for up to 21.875 million shares of Tesoro at $64 per share, a 12% premium to its $57.20 October 25 closing stock price. Post tender, Tracinda would own 20% of Tesoro. Analysis We see this development as very bullish for Tesoro and the broad refining sector. We see the tender as consistent with our view that the refiners are significantly undervalued and reiterate our Attractive coverage view. We are also maintaining our estimates and price target. Implications Valero Energy, Sunoco, and Marathon Oil are our Buy-rated refining-leveraged favorites, though we would also expect Neutral rated Frontier Oil to perform well. Tesoro is of course the company most directly impacted by this news. We remain Neutral rated on its shares at this time, though would expect its stock to perform the strongest today.

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