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

To: Ed Ajootian who wrote (63051)	4/23/2006 10:40:06 PM
From: DELT1970	Read Replies (1) \| Respond to of 206442

Ed, Big Dog or any of you savvy Wall Street guys-- in the Goldman Sachs opinions that Dennis Roth is so kind to share with us, such as this for Pogo (PPP), Goldman relates their current annual EPS estimates to estimates they are "normalizing." <<UPDATED EPS AND VALUATION We have updated our estimates to reflect the purchase of Latigo and the sale of half the company's Gulf of Mexico interests. Given the increase in reserve life, the swap is dilutive to EPS, returns and EV/debt-adjusted cash flow, though it also reduces the company's risk profile in the medium term. Pogo currently trades at 3.5x 2007 EV/DACF. This is at a discount to other mid-cap and restructuring E&Ps, though we belive the discount is warranted until Pogo shows more tangible success from newly-acquired assets. We are changing our 2Q, 3Q, 4Q and full-year 2006 and 2007 EPS estimates to $1.34 ($1.30 previously), $1.53 ($1.78 previously), $2.21 ($2.27 previously), $6.53 ($6.81 previously), and $8.80 ($9.57 previously). Our 2008-2010 (normalized) EPS estimates are now $2.20 ($2.15 previously), $1.95 ($2.35 previously), and $2.15 ($2.59 previously).>> I don't understand the "normalizing" term and how it is used to reach these low ball EPS estimates. Are they relating to $20 oil or something unrealistic?