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

To: upanddown who wrote (26597)	7/27/1998 5:02:00 PM
From: Crimson Ghost	Read Replies (3) \| Respond to of 95453

Money manager James Cramer will be staying away from oil service. Let's see if the recent lows hold after this little bounce is finished. Wrong! Rear Echelon Revelations: Why Oil's Still Looking Ugly By James J. Cramer 7/27/98 1:26 PM ET Looking over the tables this weekend, I was struck by the incredible declines in the oil service stocks in a week when the commodity did not decline. Some of these stocks were just trashed, obviously sold by people who "have to" not can, which is the sorry side of that old trader's saw "sell them when you can, not when you have to." What's behind this monster move? My bet is that some firms that had made a huge sector bet on this group are finally being liquidated. Mind you, that is not the same as selling. When you sell something, you tend to try to get the best price. But when you run money in this country, and you underperform, eventually your investors get fed up and they take the money away. This kind of selling is what I am seeing now. How long will it last? As we are JUST NOW beginning to get managements and analysts turning negative on the group, I think it can last until the end of the year. Up until this quarter's reports every management in this industry was trying to tell us why this time, even if oil stayed low, there would be a ton of drilling and the prospects were great. It turns out they were wrong. They are now coming back to reality that they service a commodity business and the commodity is too low to explore aggressively. What gets the group going again? Higher oil prices? Nah, not at this point, that won't save the next quarter. A return to prosperity in East Asia? That would help, but I wouldn't bank on it. No, what this group has to do is play out like all bad groups. It has to go through a miserable period as earnings estimates are still way too high, then it has to run the gauntlet of some incredibly nasty tax-loss selling, and then it must begin to anniversary easy comparisons, which probably won't begin until the summer of next year. Sure, you might want to bottom-fish now. But when you hit a couple-year chart of most of the stocks in this group, you see that these stocks were bid up grotesquely for the better part of two years and still have a ways to go. That's too long a plunge for me. I am staying away.

To: upanddown who wrote (26597)	7/28/1998 10:27:00 AM
From: SliderOnTheBlack	Read Replies (2) \| Respond to of 95453

O/T Does anyone here follow small/mid cap E&P companies ? PS: Is anyone interested in starting a ''general'' E&P board (using the same concept as Strictly Drilling) ? - especially oriented towards mid -small caps such as cwei, bsnx, fen, epex, sgo, eex, pgei, vpi, pog, tglef etc. There does not seem to be the individual board activity to support new boards for the small/mid caps, but a general board should be a success. Tremendous value in this sector with much consolidation and new growth stories as well. Some of the mid-large caps at present price valuations may present more opportunities with less downside than the drillers & service stocks, especially with the Natural Gas plays. The proxy here to crude oil has all ready led to some stocks selling for 3 & 5 year lows.