Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Ensco International Inc. (ESV) -- Ignore unavailable to you. Want to Upgrade?

To: jim p. holcomb who wrote (739)	2/8/1998 9:25:00 PM
From: Bill Li	Read Replies (1) \| Respond to of 2005

Jim and all, Morgan Stanley's John Lovoi is still very upbeat about the oil service sector in his recent oil service stocks overview (2/4/98). The following is the last paragraph from his report. Pay particular attention to his last words. Quickly regarding valuation. The stocks have not been this cheap in over two years. The market appears to be indicating that 1998 earnings will have to be cut significantly (or than 1998 will represent a peak level of earnings). We do not believe this to be the case for reasons outlined above. In terms of stock selection and timing, the market is assuming that the worst is yet to come in the crude oil market. The same set of factors continue to plague the market - Iraq supply, El Nino, Asian Demand and OPEC Quotas. Iraq has recently shifted from a net positive (military strike imminent) to even more negative (much larger humanitarian oil sale). The stocks always correlate closely to crude prices in the short term. We would advise using negative sentiment to your advantage. Most importantly, full positions should be built by the end of the quarter in front of the expected strengthening in the crude market that we see developing in the second half of the year. Bill