Lone Star Technologies upgraded to "outperform"

03/02/04 - Morgan Keegan

NEW YORK, March 2 (New Ratings) — Analysts at Morgan Keegan upgrade Lone Star Technologies (LSS) from “market perform” to “outperform.”

Shares of Lone Star Technologies, a diversified oilfield products manufacturer, are currently trading at $17.28.

According to Morgan Keegan’s research note published yesterday, Lone Star Technologies is well positioned to benefit from the improving operating trends in the oil country tubular goods (OCTG) markets. The analysts mention that the underlying weakness in distributor inventories and sluggish import trends are likely to lead to robust pricing and volumes growth for the OCTG market in 2004. Morgan Keegan does not anticipate any additional negative impact of the recent steel price increases on Lone Star Technologies in the near term, as compared to its peers.

The analysts express their optimism regarding Lone Star Technologies’ improved financial performance 2004 onwards, as compared to the past couple of years. The current valuation of the company’s stock is attractive, Morgan Keegan believes.

The EPS estimate for 2004 is -$0.24.

Morgan Keegan upgrades Lone Star Technologies from “market perform” to “buy.”