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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: SargeK who wrote (56945)	12/15/1999 11:09:00 AM
From: SargeK	Read Replies (1) \| Respond to of 95453

Why Fabs Now ? The SPIN: The reason FGH is not trading in step with the OSX is because it's a late cycle play. At best, we're in the very early stages of a cycle where oil majors are deciding on how much money to allocate to E&P. The first to receive these moneys are seismic surveyors then drillers and service. Coming in last are fabricators. Only when rig utilization is approaching saturation levels do fabricators receive orders justifying higher P/Es. What a crock of B…S..t! THE REALITY: The Major's have already plotted their older block's of lease's, and have been waiting patiently for the increase of oil to justify new rig utilization on these lease's. (Seismic surveys will be at the bottom of the chain, NOT in front of it.) We're in the very early stages of a cycle where oil majors are deciding on how much money to allocate to E&P. DRILLERS have already begun to receive upward daily rates for their rigs. The Drillers need retrofit for present rigs and will have the need for new rigs when they hit their optimum number of working rigs, and vessels to supply new and existing rig's. This company is more than just a Fabricator of Rig's, It has centered itself in the midst of the biggest upcoming vessel regulations seen in decades. NO domestic company is in a better position to profit from double-hull rebuild and new build than the merged resources of Friede Goldman Halter, Inc. Their capability for rebuild, retrofit and construction of new FPSOs is also second to none. When the orders start pouring in for new builds it will merely be icing on the cake. In the meantime the Company will continue to provide retrofit and service for current operating units at very profitable margins. Except for the third quarter loss resulting from accounting charges to Unresolved Claims, FGH earnings compare favorably with almost any Oil Service company you wish to compare it to. And, the best is yet to come. Note: Since Slider has tendered a cease and desist request regarding FGH, I will reduce my posts AS LONG AS HE KEEPS HIS WORD. >VBG< I wonder if he is still holding his breath? >LOL< SargeK FOR THE RECORD: I carefully selected FGH from a number of candidates to demonstrate how and why a company's stock can go from $45 to $6 3/4 while its size and stock holder's equity grow exponentially. Market forces set the 'Cap' valuation based on a number of relatively 'minute' trades. When the appetites for full positions are sated (no sellers remaining), these same forces will drive the stock to $50 and beyond in relatively the same amount of time. I have used FGH as a surrogate to focus attention on this phenomena.