Are Refinery oil stocks worth a look?

I'm no expert but when you think when oil goes up, everything in the oil sector should go up as well. Not the case with the oil refiners. Companies such as Tesoro(TSO), Valero(VLO), and Sunoco(SUN). These are the companies that buy the crude oil from big suppliers and make it into useful gasoline and other products. Apparently the price of crude oil and the price of gasoline price has not been going up in tandem. TSO and SUN actually lost money in the current quarter. Is there opportunity here??

If we had to pick, we got to go with best of breed and that's Valero (VLO). Although earnings in the last quarter has dropped, it still made money. Plus they are selling some of their non core refinery assets which can boost their cash and stock buyback. The stock is trading at $47 and it has a book value of $34. Eventually gasoline prices should rise thus pushing Valero higher. With $3.74 billion in net income divided by enterprise value of $29 billion, that's close to a 13% initial rate of return on investment. -Stock Article Link

Valero Earnings Transcript

One on one interview with Warren Buffett

" WARREN BUFFETT, CHAIRMAN & CEO, BERKSHIRE HATHAWAY: I don't spend a lot of time thinking about the economy. Nevertheless, what I see would indicate to me that this is not a short-run phenomenon.....

It still has a ways to go. I mean, there's a huge inventory of houses around and they went up too far. In many areas they went up to crazy levels. The money isn't going to be enough, able to -- available to finance crazy prices anymore.....

I'm looking for a business I can understand. It has to be something that I can get my mind around. It has to have durable competitive advantage. It can't be a hula hoop company or something like that. It has to have a management that I trust and admire. And then it has to be at a sensible price and preferably it has to be big. And every now and then we get a chance to do that...."

-Stock Article Link

Gene Marcial recommends 7 stocks for 7 years.

"You'll rarely fail if you concentrate on major big-cap stocks. Start with the 30 components of the Dow Jones industrial average, or the most widely held stocks, including IBM (IBM), Boeing (BA), AT&T (T), American Express (AXP), Coca-Cola (KO), and ExxonMobil (XOM)."

"A good example of a stock that challenged investors is Goldman Sachs (GS), the premier U.S. investment bank."

-Stock Article Video Link

Investing guru Francis Chou gets #1 spot for bond funds

"Francis Chou, 52, of Chou Associates Management Inc., is one of those survivors. His $90-million Chou Bond Fund (US$), established in the fall of 2005, soared to the No. 1 spot among 65 funds in the high yield sector with an average annual compound gain of 10.4 per cent for the two years ended Feb. 29, 2008..."

"As he wrote in his 2007 report to unitholders, “the cardinal principle of investing is to think first about preserving capital before thinking about making money. The greater the probability of permanent loss of capital, the greater the spread should be between a particular debt instrument and risk-free treasuries.”

He explains his 10 core principles-Stock Article Link

Lenny Dystra recommends Forest Labs (FRX)

"The company develops, manufactures and sells both brand name and generic drugs and pharmaceutical products. Its two biggest drugs are anti-depressant Lexapro and Namenda, which is used to treat Alzheimer's and dementia.

Forest Labs' balance sheet is pristine with $1.7 billion in the bank and no debt. It has a number of phase III and phase II drug trials ending in the next year and half."-Stock Article Link

Currently trading at near it's low of $34.17.

Eddie Lampert increases AutoNation stake to 37.9%

"Billionaire investor Edward Lampert has raised his stake in AutoNation Inc (AN), the No. 1 U.S. auto dealership group, to nearly 38 percent, according to federal regulatory filings.

Lampert, who is also chairman of Sears Holdings Corp (SHLD), bought 383,500 shares on April 30 for prices ranging from $15.89 to $16 per share, raising holdings under his control to about 67.6 million shares."-Stock Article Link

Personally I don't see the attraction to this stock. It's high in debt, low in ROE....time to read the transcript and see if I can find anything interesting...Earning Transcript Link

Recent Insider Buys

30-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 344,113 Indirect Purchase at $15.89 - $16 per share. $5,487,0002

30-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 39,387 Indirect Purchase at $15.98 - $16 per share. $630,0002

29-Apr-08 MIGOYA CARLOS A
Director 5,000 Direct Purchase at $16.17 per share. $80,850

29-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 234,033 Indirect Purchase at $15.89 - $16 per share. $3,732,0002

29-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 5,967 Indirect Purchase at $15.89 - $15.98 per share. $95,0002

28-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 190,056 Indirect Purchase at $15.62 - $16 per share. $3,005,0002

28-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 61,432 Indirect Purchase at $15.81 - $16 per share. $977,0002

28-Apr-08 LAMPERT EDWARD S
Beneficial Owner (10% or more) 120,565 Indirect Purchase at $15.62 - $15.99 per share. $1,906,0002

Eddie Lampert Video to the Shareholder Annual Meeting

"Highlights are

- Lampert doesn't see a turnaround so far in consumer economy and doesn't foresee one this year.

- He hasn't seen a benefit as yet from interest rate cuts but does think that there will be a benefit.

- He thinks the market is flooded with too many stores being opened by competitors.

- Brands seem to be the new bet for Sears--are brands/merchandising replacing Lampert's emphasis on the underlying real estate play?

- There is a fundamental shift in how consumers shop. Part of that is due to increasingly specialized brick and mortar as well as online retailers.

"-Stock Article Link

Billionaire Sam Zell sees mortagage back securities improving

"I believe the overall market has already started to ease,'' Zell, chairman of Equity Residential, the largest U.S. apartment owner, said in an interview in New York. ``Is it in large volumes? No. Is it the first natural step in the evolution? Yes.'' -Stock Article Link

RetireRichBlog Stock Mutual Fund Performance for May, 2008

Although the credit meltdown has somewhat recovered, the Retirerichblog performance portfolio on Marketocracy.com still hasn't. The value is down $273,683.00 from a starting basis of $1,000,000. Partly to blame is my position in First Marblehead (FMD) postion. I have to remind myself not to take such a big position when it keeps going down. Sometimes I get carried away. Citigroup(C) and Washington Mutual(WM) probably won't recover for a while but I'm comfortable just holding on to them. When when we hit August 27, it will be a full year which is a couple more months away. I just want to get back in the black!

Click images for a closer look.

Thinking of buying Motorola (MOT). Think again.

A $10 stock might look cheap but with so much competition in the handset business, it's hard for Motorola to gain any ground.

"About a year ago, Carl Icahn bought 3.6% of the company's stock, either directly or through long-term options, for about $18.36 per share, or almost twice its current price. He was unsuccessful in securing a board seat last April in his proxy battle against then incumbent management. He could have gotten out then with not much of a loss. The market gods were trying to tell him something, but he failed to hear the message."-Stock Article Link

"..the Koreans are grabbing market share in both the U.S. and emerging markets..Last year, Samsung Electronics passed Motolola to become the world's No. 2 player in the cell phone industry.."-Stock Article Link

Finding bargains in the IPO bin.

"Of the 219 IPOs that launched in 2007, 149 are busted already, according to Thomson Financial."-Stock Article Link

Lenny Dystra recommends Dell

Lenny Dystra likes Dell and so do I.

"Dell is a solid company. Dell may not be the sexiest pick, but the company has no debt and its return on equity (ROE) is off the charts. It has $8 billion in the bank and $4 billion in cash flow. Its forward price to earnings is an attractive 10.8."-Stock Article Link