To: AlienTech who wrote (8372 ) 2/12/1999 8:32:00 AM From: LastShadow Read Replies (1) | Respond to
FRIEDE GOLDMAN INTERNATIONAL (FGI) 11 7/8. Some companies in the oil sector are still making a lot of money, but they aren't getting much credit in terms of the stock price. After the close Wednesday, oil drilling services company Friede Goldman (FGI) reported excellent fourth quarter profits of $0.51 a share, a whopping eleven cents ahead of expectations, and up strongly from the year-ago profit of $0.19 per share. Revenues rose a hard-to-argue-with 302%. FGI has managed to post solid revenue and profit growth this past year, yet the stock has taken a beating along with the overall pounding that oil stocks have taken. In fact, with the decline in oil prices, most oil companies and oil services companies have experienced significant business problems. Not FGI though, as witnessed by these numbers. FGI also announced that the backlog of orders at the end of 1998 was $365 million. That isn't up all that much from the backlog of $321 million at the end of 1997, but FGI noted that in early 1999 they also received another $143 million order. Revenue and profit growth in 1999 will probably slow down, but there will be further growth. These prospects are not in the stock price. FGI was a hot stock in 1997, and by May of 1998 the price had risen over 40. Since then, it has been on a downslide as it became evident that depressed oil prices may be around for a while. At the current stock price, FGI trades at only 8.3 times trailing 12-month (1998) earnings of $1.43 per share. Given that FGI is still posting solid revenue and profit growth, that is pretty darn cheap. Investors in FGI are fighting negative sentiment towards the entire oil sector, but the numbers for FGI themselves are still very good. If perceptions for the industry ever improve, FGI could be one of the first stocks to benefit. Yesterday's numbers represent excellent growth for a stock trading at low multiples.
