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

To: Broken_Clock who wrote (7912)	1/13/1998 7:10:00 PM
From: Big Dog	Respond to of 95453

First, I want to thank everyone for all the information collecting efforts. That is one of the best benefits of putting up with you characters -- and Barbara's. Between all of us I doubt there is an iota of info about the sector that is not displaed here for all. Please keep up the good work. The following is from a Jefferies Energy Group report they mail to professional and institutional investors -- not the general public. I have included below the part that pertains to the oil service sector. Written January 7. (Excuse typos and spacing...it was a scan.) Oil Service Sector Outlook We believe oil service stocks represent an excellentintermediate and long-term value despite declining investor sentiment driven by weakening short-term commodity prices. Our analysis shows that the business cycle in oil services still has a long way to run - potentially well into the next millennium. We believe exploration and production spending decisions are based on multi-year views for commodity prices and are largely immune to short-term price fluctuations. The recent sell-off in oil service stocks closely mirrors the decline experienced in first quarter 1997, when natural gas prices briefly declined to below $2.00/MMbtu. We believe that most of our stocks are trading well below historical valuation ranges and that many of these stocks will show large gains from here once the market perceives that commodity prices have bottomed. However, in the near-term, we would focus on companies with: High earnings visibility from growing backlogs, minimizing risk to 1998 and 1999 results. Specialty products or services in consolidated markets where capacity shortages are high, providing the potential for substantial pricing leverage beyond our existing forecasts. Limited short-term commodity price sensitivity from longer planning horizons associated with these products and services, particularly deepwater and international related products and services. Good international exposure, where the presence of independents is less, calming investor fears about short- term spending swings. Valuations well below historical trading ranges. Strong management teams with demonstrated ability to increase shareholder value. Companies with strong balance sheets and large amounts of uncommitted free cash flow. We find these characteristics in: Friede Goldman (FGII-$22 3/8) 12 mo target - $50 Global Industries (GLBL-$13 3/4) $30 Varco International (VRC-$18) $36 Santa Fe International Corp. (SDC-$36) $57

To: Broken_Clock who wrote (7912)	1/13/1998 7:12:00 PM
From: Big Dog	Respond to of 95453

Following rcvd from CFO of MIND. I asked about why they used a secondary offering instead of bank debt to fund expansion. Here is his reply: Mike, the most we could get from the banks was approx $15million. not enough to cover our immediate needs. we will definitely go the debt route with our next needs. we have already begun discussions on this with several companies. it looks as though the right decision was made with regards to pricing at year-end. the stock has tumbled, not as a result of anything we have done. when we started our discussions with the underwriters, the stock was trading at $22. we were not unhappy with the secondary being priced at $19. keep in mind, the stock was at $7 in march of 1997. Bob