Zacks Analyst Interview Highlights: ExxonMobil, Chevron, ConocoPhillips, Transocean and Diamond Offshore

Business Wire, May 13, 2008

CHICAGO -- Zacks.com releases the latest Analyst Interview. Today's interview is with senior analyst Sheraz Mian, who discusses ExxonMobil (NYSE: XOM), Chevron (NYSE: CVX), ConocoPhillips (NYSE: COP), Transocean (NYSE: RIG) and Diamond Offshore (NYSE: DO).

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Do large integrated oil companies also have the means to develop alternative energies at some point in the future?

They have the means, in terms of resources, but not necessarily the incentive to go for it. They are in the business of producing and selling hydrocarbons-based energy products and they are doing a very good job at that. Much better, I would add, than many of the national oil companies of the world. They have helped develop sources of hydrocarbons that were not very conventional even a few years ago - sources like the deepwater, tar sands, shale oil etc. In fairness to them, they do invest a fair amount technological improvements and efficiencies.

Which companies would you consider your top Buy recommendations at this time?

While it is true that I have all along favored the large-cap integrated company group within this space, I also like selective oilfield service and drilling names. As I mentioned earlier, I am looking for continued weakness in crude oil prices in the near term. Historically, this has not been a favorable backdrop for stock prices in the energy space. As such, I would expect across-the-board weakness in the group in the face of moderating commodity prices.

This is only a short-term headwind and should not be of much concern to long-term investors who should view this expected pullback as an opportunity to add to their positions in large-cap integrateds - ExxonMobil (NYSE: XOM), Chevron (NYSE: CVX) and ConocoPhillips (NYSE: COP) - offshore drillers, particularly with deepwater drilling capabilities - Transocean (NYSE: RIG), Diamond Offshore (NYSE: DO).

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