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Marathon Oil Corporation Message Board

  • datamatters2003 datamatters2003 Jan 4, 2005 11:37 AM Flag positive article on MRO

    I cut and pasted this from an article that appeared this a.m. in
    Merrill Lynch said the integrated oils sector is unlikely to match 2004's peak performance but added that 2005 may still be a strong year. The research firm reiterated "buy" ratings on ChevronTexaco (nyse: CVX - news - people ), ConocoPhillips (nyse: COP - news - people ), Marathon Oil (nyse: MRO - news - people ) and Exxon Mobil (nyse: XOM - news - people ), with target prices of $60, $95, $47.50 and $55, respectively. "The sector may be viewed defensively by the Street," Merrill Lynch said, "but we think its below-average market price-to-earnings ratios [and] high free cash flow yields justify ownership in an uncertain market." Among the trends that will affect the sector in 2005 are continued price inelasticity, a weaker dollar, demand from China, access difficulties and the stock market's lagging recognition of reduced levels of spare capacity. "Most integrateds have rationalized non-strategic assets, and will likely grow upstream volumes 3.5% per year through 2008," Merrill Lynch said. "We estimate that the sector will generate $32 billion in free cash flow in 2005 and note that most companies will have the least amount of fiscal leverage in decades."

    Also, I note with interest only two MRO insiders have sold since 9/30/04, and neither of them is a chief officer. In the absence of insider buying and with oil prices likely to be stronger this May and maybe weaker in Feb. and March (IMHO), I don't plan to add to our MRO position right now. But I will look at it closely in March to possibly add.

    A joyful and fulfilling new year to you all!

8.46-0.73(-7.94%)Feb 5 4:03 PMEST