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

To: Lucretius who wrote (12842)	2/25/1998 6:41:00 PM
From: Flan	Read Replies (2) \| Respond to of 95453

Hey Luc - the only group to not participate in todays strong market was the land drillers PTEN, DPSI, KEG etc. Are things really beginning to fall apart for this group - I would expect softness but these stocks have been torn to shreds - What is your take is it going to get alot worse before it gets better -Are these stocks going to be in the low single digits like they were a few years ago.

To: Lucretius who wrote (12842)	2/25/1998 7:04:00 PM
From: david james	Read Replies (1) \| Respond to of 95453

Anyone know the typical margins that companies get building drilling rigs? American Eco (ECGOF) is completing a deal to acquire Dominion Bridge which will include Davie Industries. The CEO of American Eco believes Davie can build 3.5 rigs per year at $150-$200 million per rig and we are trying to figure out what sort of earnings we might expect. Might want to watch American Eco over the next two days. Earnings will be reported probably tomorrow - Friday at the latest. We are expecting around 37 cents ($1.20 for the year) vs 20 cents in 96. That's 85% growth and the stock currently trades at a trailing 12 month P/E of 11. With the Dominion Bridge acquisition, American Eco should have revenues in the range of $1 billion in 1998 and with a current market cap of $220 mill, the company is trading at 0.22 of 1998 revenues. The Dominion Bridge revenues have not yet been figured into Eco's estimates for 98, but the CEO believes that the acquisition will be accretive to earnings. In 1998, American Eco (via MM Industra) will probably be the principle fabricator to the Sable Gas Field project off Nova Scotia bringing gas to the northeast by the end of 1999. And they will be competing with Friedman Goldman for contracts in the Terra Nova Oil project off Newfoundland. Anyone getting 20% margins building rigs? David P.S. Although ECGOF is Canadian registered and gets preference for Canadian contracts - its run out of Houston. The governor of Texas (Mark White) was the previous Chairman of the board.