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

To: oilbabe who wrote (58384)	1/13/2000 9:38:00 AM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 95453

Trading here... I am still in lots of cash and happy to be so. But, I am looking to put lots of it to work here during earnings reporting and I wanted cash & buying leverage/margin to be able to take advantage of individual stories as they unfold. I think the OSX does not have a lot of downside here - the underlying fundamentals are very , very strong. The story in the nearterm for traders is this earnings reporting period. It is not so much an opportunity to buy the "OSX" cheap - but, rather to get individual stock buying opportunities of a major degree - while the OSX index may not move all that much. We have not had a single quarter of late, to where there have not been major blow ups. HAL BHI FGH etc. This is expected to finally be a "trough" period for service & drillers. BJS - a strong early cycle play is leading the trend. Stocks like SII another early cycle play are getting mo-mo $ here, but are not cheap and I can not see anyone other than someone like Fidelity who has to continually throw cash at the sector -buy these particular stocks here. These fav's in fact, present some short term shorting opps. Papaya King went with puts on SII here of late I believe and that is a good strategy that has paid off here. I think the "trading " idea here is to pick up the "quality" blow ups - like BHI - at/sub $20 this becomes a great trader , or longterm hold. Also, we will see rotation to the laggards and smaller caps as the SII BJS CAM WFT's outrun themselves. Even the big three - SLB HAL BHI - can be a great trading play; as when we do get another rush of rotation funds; once these 3 start showing bottomline upside surprises - the cash will flow strongly to these 3; whom are very cheap here presently. It's surprising to many the degree that they have led the more "boutique" names like BJS SII CAM WFT et al. Drillers - are in a sweet spot; a strong retrace off of earnings season is a great buying opp here. I bought RIG FLC PTEN earlier as these 3 give you total coverage of the drilling spectrum and were much, much cheaper than their peers a month , or so ago. Now, I think DO is becoming a bit of an anomaly play; while their Earnings fundamentally will not recover as quickly as NE ESV RDC - those stocks are priced ahead of themselves and DO is clearly a laggard if you compare price valuations to the prior cycle moves in the drillers. DO sub $28 looks like a no-brainer here. I also love the seismic combo of PGO - VTS. VTS was one of the hottest movers in the prior cycle, these guys can ramp sales & earnings very, very quickly. PGO owns deepwater seismic and their FPSO business is ahead of the game & is undervalued. Both of these are buys today - and strongly into any weakness. In fab's I like both GIFI & UFAB on any weakness; again - they don't need the massive cap ex commitments that FGH will need to dramatically ramp up earnings. I think UFAB is a potential 3 bagger here in 18 mos. This is a $20 stock at mid - to peak cycle of a Boom 2000-2001 recovery imo. E&P's - XTO has strong earnings - will be cheap on a PE basis & is a gift on cfps valuation metrics. PXD sold assets & lost production - downsized. But, PXD is one of the most leveraged companies to this sustained commodity price environment and among the cheapest companies on a "reserve" basis in this universe. UPR OEI look great here, NBL & EOG are must owns - and lets learn to buy our Nat Gas stocks in the Winter and to Sell into the peak contraseasonal cycle of late summer - pre heating season/September. VPI is a near pureplay on Crude, anyone watching NEV a real crude pureplay move here of late against the grain - and they have terrible hedging in place now. Buy the dips - we'll get some. Its not so important what the OSX index does - as we have some redistribution to do within the index - watch individual names; BHI is a must own at $20ish, PGO VTS too cheap here, FLC close, DO here and follow her down.