Zacks Analyst Interview Highlights: February 2008

Zacks Analyst Interview Highlights: Conoco Phillips, National Oilwell Varco, Transocean, Southern Copper and Freeport McMoRan

Feb 21 2008

CHICAGO--(BUSINESS WIRE)--Zacks.com releases the latest Analyst Interview. Today’s interview is with Director of Equity Research Dirk van Dijk, who discusses Conoco Phillips (NYSE: COP), National Oilwell Varco (NYSE: NOV), Transocean (NYSE: RIG), Southern Copper (NYSE: PCU) and Freeport McMoRan (NYSE: FCX).

A synopsis of today’s Analyst Interview is presented below. The full article can be read at http://at.zacks.com/?id=2678.

So what is your overall case for our economy existing in a state of stagflation?

It is more and more clear that we are entering a recession (if not already in one), yet inflation is still high and rising. This is the very definition of stagflation. The Fed cutting rates in the face of higher inflation is unusual to say the least. However, there are very real risks of a full-scale financial implosion, and this is first and foremost on the mind of Bernanke.

Quite simply, the Fed is faced with a choice of repeating either the 1930's or the 1970's. Given that choice, well, it's time to break out the bellbottom pants and leisure suits.

With this in mind, where should investors turn?

Stay with commodity-oriented stocks which tend to benefit from inflation. Energy is first and foremost of these areas. For a low-risk way to play it, go with the big integrated names like Conoco Phillips (NYSE: COP). For higher risk/return plays, go with the Oil Service and Drilling firms like National Oilwell Varco (NYSE: NOV) and Transocean (NYSE: RIG). Metals plays like Southern Copper (NYSE: PCU) and Freeport McMoRan (NYSE: FCX) are also attractive.

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The performance of the Zacks Rank portfolios for annual and year-to-date periods are the linked monthly total returns (price changes + dividends) of equal weighted hypothetical portfolios, consisting of those stocks with the indicated Zacks Rank, assuming monthly rebalancing and zero transaction costs. These are not the returns of actual portfolios. The hypothetical portfolios were created at the beginning of each month from January 1988 forward based on the values of the Zacks Rank available to Zacks' clients before the beginning of each month. The portfolios created monthly from 1988 through September 2006 exclude ADRs and are comprised of stocks that have the indicated Zacks Rank and were covered by at least two analysts at the time of the stocks inclusion in the portfolio. Starting in October 2006 and going forward, the portfolios are comprised of all stocks with the indicated Zacks Rank and do not exclude ADRs, which is more reflective of the list of stocks that customers will find on the Zacks web sites. These performance numbers have been audited from 1995 through 2003 by Virchow, Krause & Company, LLP.