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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: mred1998 who wrote (39540)	4/8/2005 10:57:31 AM
From: mred1998	Read Replies (1) \| Respond to of 206223

The Golden Age of Refining Updated; Raising Estimates GICS SECTOR ENERGY Strategist's Recommended Weight 9.7% S&P 500 Weight 8.7% • Maintain Attractive View on R&M Integrated Oils appear modestly undervalued based on mid-cycle returns on capital. In our view R&M represents the best valuation per unit of return on a mid-cycle basis in the energy sector at this time. • New Fundamental Outlook Renders New Forecast In US R&M New projections for demand, supply and imports render a decline in expectations for inventories from 23.4 to 23.1 days in 2005. Our projection for US R&M margins increases from $6.15/bbl to $6.45/bbl. • Morgan Stanley’s’ Earnings Projections Rise By 25% Q1 2005 & FY 2005 Morgan Stanley’s earnings projections have increased by 25% for Q1 2005 and FY 2005. Our projections are around 25% above consensus for both periods. • Consensus Estimates May Be Too Low By 50% For 2005 While consensus estimates have increased by 30% thus far in 2005, they are still too low by at least 25%, in our opinion. If spreads in the futures market are sustained, consensus estimates must rise by 50-75% for 2005 and 2006. • VLO, PCO Favorite Independent Refiners; COP, XOM Favorite Integrated Oils Overweight equities VLO (PT-$85), PCO (PT-$67) are our favorite Independent Refiners with ExxonMobil and ConocoPhillips representing our top picks among the Integrated Oils. Integrated Oil & Independent R&M Industry Overview April 1, 2005 Douglas Terreson Morgan Stanley