Published: June 7 2007 03:00 | Last updated: June 7 2007 03:00
European oil stocks may be about to outperform as earnings momentum turns, says Nick Nelson at UBS.
“There have been fewer earnings upgrades for the oil sector than the wider market over the last year. But there are now signs this may be changing. We saw a similar event in June 2006 in the telecoms sector when relative earnings momentum turned positive, and it was one of the best performing sectors in the second half.
“We see four near-term supports for oils. First, we suspect we are past the peak of dollar weakness [now down just 4 per cent year on year versus the euro]. Second, valuations are attractive [the price/earnings relative to the market is 79 per cent, close to a 17 year low]. Third, balance sheets appear underleveraged. Fourth, the European oils have underperformed the US oils by 23 per cent over the last two years. The price relative of European oils is back down to where it was three years ago when oil was at $30 a barrel.”
Mr Nelson notes that in the recent first-quarter reporting season, more oil companies beat earnings estimates than missed them for the first time in a year. “Assuming the oil price stays at the current level [Brent oil is around $70 a barrel], that suggests we would start seeing absolute upgrades to oil sector earnings per share over the summer,” he says. Three particular stocks highlighted by UBS are Total, Royal Dutch Shell and BP.
Copyright The Financial Times Limited 2007
This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.
Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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