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

To: drsvelte who wrote (23574)	6/6/1998 11:57:00 PM
From: XOsDaWAY2GO	Read Replies (2) \| Respond to of 95453

...Back to drilling...... >>>Asian Crisis Will Restrain Q2 Profits By Huw Jones Reuters First Call expects earnings of oil majors to fall 22 percent, but those of companies servicing them, the drillers and equipment makers, to rise 51 percent and 22 percent respectively. 'The majors are in the tank because of low oil prices, but they are not low enough to cut back exploration,'' Hill said. But there are already signs that oil producing countries, led by Saudi Arabia, are taking steps to cut exports to boost flagging prices. ''This is the last quarter that oil is going to impact the year-over-year earnings growth for the broader aggregates in the S&P500,'' said Joseph Abbott, an analyst at earnings tracking firm I/B/E/S International.<<< Barbara

To: drsvelte who wrote (23574)	6/7/1998 2:13:00 PM
From: Alski	Read Replies (2) \| Respond to of 95453

drsvelt, (OT - Concrete hedge) Concrete favs Southdown Inc (NYSE:SDW) and Lone Star Inds (NYSE:LCE) have been correcting since late April, early May. Neither have SI threads and their YAHOO! threads are lightly posted. Nobody should trust my TA but it looks to me like their technicals may be about to signal a reversal; except for momentum, which still sucks. Any TAers left on this thread care to comment? A third, less pure play would be Centex Construction Prods (NYSE:CXP). It's been holding up through the correction. My read of their technicals says a move is coming, but it's not to likely to be up. Looks to me like, unless there's some interesting local play, it's a bit early to buy concrete. Alski

To: drsvelte who wrote (23574)	6/8/1998 7:50:00 PM
From: jbe	Read Replies (2) \| Respond to of 95453

[OT] Concrete as a hedge for Oil??!! Although I will renounce the title of "Master of Financial Discourse", I will own up to owning three concrete companies -- two of which are located in Texas. They are: Southdown (SDW); Lone Star Industries (LCE); and Texas Industries (TXI), which makes steel as well as concrete products. How did I get into concrete? 1) It was boring, which has its advantages. For example, crazies are not attracted to boring industries. 2) In this industry, there were many apparently well-run and profitable companies, with beautiful balance sheets, loads of free cash flow, excellent growth rates, nice low p/e's and low PEGS, etc. It's just a matter of going "eeny, meeny, miney (sp.?), mo" and then picking one or two with your eyes shut. You won't go wrong. 3) Finally, the industry itself was experiencing a boom, and concrete was steadily moving up in the IBD industry rankings. As a sector rotation play, it seemed to make sense to buy concrete companies, especially in view of the fact that they were such good companies in themselves. Would I recommend that other people buy concrete as a hedge (or for any other reason)? 1) Alski is right that the industry has been going through a mini-correction (thanks to me, no doubt -- I hex everything!). The stocks I bought are all down from the time I bought them, although they are still up for the year. LCE is up 36% for the year; TXI is up 25%; SDW is up 8.5%. One that has bucked the trend this past month (better than CXP) is Florida Rock (FRK). 2) But it is not just concrete that has been correcting. Basic materials as a whole have struggled this month, and the housing industry also. Indeed, it has not been a good month for any industry I personally have a stake in, except for pharmaceuticals. At the same time, I would not advise anyone to go into pharmaceuticals right now, because by any conceivable standard those companies are all very, very overvalued. 3) I still think concrete looks like a good bet. Read Southdown's annual report, which I think is on its web site, to get an idea about expansion opportunities for the concrete industry (e.g., the use of concrete rather than asphalt in road construction). But I would agree with Alski that it might be best to wait a bit before placing that bet. The question(s) I would ask is why the correction in basic materials, home construction, furniture, etc.? And how long is it expected to last (if anybody is willing to guess)? Is "consumer confidence" eroding? jbe