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

To: Lucretius who wrote (14783)	3/13/1998 7:13:00 PM
From: RGinPG	Respond to of 95453

I think FGII's fall was in complete sympathy with HLX. They both own shipyards, but that's where the similarity ends. HLX is the 7th largest ship builder, THE largest builder of small ocean going vessels. FGII has three (presumably efficient) shipyards that build RIGS. To me, these are completely different. FGII's earnings estimates have been revised upward 5 times in the last two months (out of 4 analysts), and their next two years earnings have been revised upwards 5% over the last two weeks. They have had positive earnings surprises the last two quarters of 28% and 11%. They are way in the oversold area on stochastics now. My plan: Buy FGII on any weakness on Monday. Dump HLX on any strength, definitely get rid of it by the end of the day.

To: Lucretius who wrote (14783)	3/14/1998 10:03:00 AM
From: wggm	Read Replies (1) \| Respond to of 95453

Luc or anyone else, a few questions re oil prices and consolidation: 1) When do you think there will be an OPEC production cut? 2) Everything I have read indicates that the Venz are adamant about not cutting. Is your prediction of a production cut predicated on more pain for the Venz caused by even lower oil prices near term? If its not, why do you think there will be a production cut? 3) It seems too easy to just sit back and wait for an oil rally and then buy the drillers. What do you think the likelihood is that the drillers will start their move prior to oil rallying? 4) Do you see consolidation among the drillers? I have heard rumors as to takeovers of MDCO and BDI. The more obvious acquisition candidate in my opinion, however, would be Diamond Offshore. The Tischs are viewed as not being interested in building the business (as indicated by DO's decision to increase dividends as opposed to share buybacks. Also, the President recently resigned. Does anyone have any views as to whether they will put the company up for sale. Also, aside from takeover speculation, how do you rate this company vs. the other drillers (I know DO, along with RIG, is one of the two most concentrated deepwater drillers, but is it a better buy than RIG, NE, FLC, GLM, etc. at these levels?). (For what its worth, I am long most of the afforementioned names, but I haven't seen much discussion re DO on this board). Thanks in advance for any comments received.