biz.yahoo.com Tuesday March 4, 7:00 am ET By Christopher Davis

We've been talking to a lot of value-oriented mid-cap fund managers lately, and their picks run the gamut, ranging from utility and retail stocks to beaten-down blue chips and retailers. Below is a roundup of some of the names that have emerged in recent conversations with stock-pickers.

Dave Wallack, T. Rowe Price Mid-Cap Value (Nasdaq:TRMCX - News) Although he hasn't been at the helm of this offering for long, Dave Wallack has executed his bargain-hunting style with aplomb. He bought beaten-down financials and media names such as SAFECO (NasdaqNM:SAFC - News) and Washington Post (NYSE:WPO - News) in 2001, in time for their rallies in 2002. More recently, Wallack has lightened his stakes in those names while adding electric utilities FirstEnergy (NYSE:FE - News) and TXU (NYSE:TXU - News), which he says were unfairly painted with the same brush as Enron (Other OTC:ENRNQ.PK - News) and other highly-leveraged energy traders. And he boosted his weighting in oil producer Amerada Hess (NYSE:AHC - News) after it slumped amid worries over its ties with politically volatile Venezuela and disappointing exploration results in Africa. Wallack says the company trades at a large discount to its private market value, though, and stands to benefit from higher oil prices. He also initiated a position in telecom-equipment maker Tellabs (NasdaqNM:TLAB - News). He says the company is reasonably priced, boasts a solid balance sheet, and is the dominant equipment provider to Baby Bells such as SBC (NYSE:SBC - News) and Verizon (NYSE:VZ - News), the survivors of the telecom wreck.

John Rogers, Ariel Appreciation (Nasdaq:CAAPX - News) John Rogers recently took charge of this fund, but his long and successful record at Ariel Fund (Nasdaq:ARGFX - News) suggests that paying attention to his picks can be worthwhile. He seeks out companies trading at a 40% discount to their intrinsic values and favors firms in consistent and stable industries with high barriers to entry. In 2002's fourth quarter, high-end retailer Tiffany (NYSE:TIF - News) met his standards on a number of fronts. For one, its brand name is renowned, so much so that it devotes a far smaller percentage of sales to advertising than other luxury retailers. Second, Rogers contends it is a high-quality business. Tiffany's classic designs have a shelf life of 20 to 30 years, which enables it to adhere to a strict policy of never putting merchandise on sale. Management is also seasoned and has a strong record of boosting margins and maintaining high returns on capital. The stock is down thanks to slumping sales in Japan, but Rogers thinks the dip is temporary and provides an opportunity for long-term investors.

Bob Olstein, Olstein Financial Alert (Nasdaq:OFALX - News) It's taken the collapse of Enron and WorldCom to get investors to appreciate the virtues of conservative accounting, but Bob Olstein has insisted on clean balance sheets all along. He also requires his picks to trade at a 30% discount to their intrinsic values and doesn't necessarily limit himself to mid-caps in his quest for bargains. In recent months, for example, Olstein and his team picked up Home Depot (NYSE:HD - News) and McDonald's (NYSE:MCD - News), arguing these battered blue chips can fix their operational problems and reward cash-flow-hungry investors. They've also found opportunities in select technology stocks lately. Fairchild Semiconductor (NYSE:FCS - News) and International Rectifier (NYSE:IRF - News) have been among their favorites because they expect the companies to profit from increased demand for power chips. The managers also picked up Tyco (NYSE:TYC - News) in December, believing the company's new management and new auditors have it headed down a prudent path. They scooped up shares of the industrial conglomerate at around $15 and peg their worth in the low $20s.

This article is intended to feature the viewpoints of individual fund managers. The opinions expressed are not necessarily those of Morningstar, and investors should not consider the stocks mentioned above as recommendations from Morningstar analysts.

Christopher Davis is an analyst with Morningstar.com. While he welcomes your email, he cannot answer financial planning questions. He can be reached at christopher.davis@morningstar.com.

reuters.com Tue March 4, 2003 10:14 AM ET (The following statement was released by the ratings agency)

NEW YORK, March 4 - Standard & Poor's Ratings Services said today it assigned its 'BB' corporate credit rating to General Maritime Corp GMR.N . At the same time, Standard & Poor's assigned its 'B+' senior unsecured debt rating to the company's proposed 10-year $250 million note offering. The long-term rating outlook is stable. New York, N.Y.-based General Maritime is engaged primarily in the ocean transportation of crude oil and petroleum products. The company owns and operates a fleet of 28 oceangoing vessels (23 Aframax tankers and 5 Suezmax vessels).

"Ratings on General Maritime reflect the company's favorable business position as a large operator of midsize Aframax and larger Suezmax petroleum tankers with a strong market share in the Atlantic Basin, diversified customer base of oil companies and governmental agencies, and fairly good access to liquidity," said Standard & Poor's credit analyst Kenneth L. Farer. "These factors are offset by significant, but managed, exposure to the competitive and volatile tanker spot markets and an aggressive growth strategy," the analyst continued.

In January 2003, the company announced it would acquire the 19 vessels owned and operated by Metrostar Management Corp. for $525 million, increasing General Maritime's fleet to 47 vessels (28 Aframax tankers and 19 Suezmax vessels) with capacity equal to about 6% of the world Aframax and Suezmax fleets. The transaction is expected to conclude by April 30, 2003. This acquisition expands General Maritime's scope of operations to Europe, the Mediterranean, and the Black Sea, in addition to increasing the total fleet cargo carrying capacity, with a small decrease in the combined fleet's average age.

Tanker rates increased dramatically in the fourth quarter of 2002, reversing declines during the second half of 2001 and most of 2002, and have remained high, reflecting a cold winter, war premiums associated with a potential conflict with Iraq, and an extension of transit time to supply North America due to the oil company strike in Venezuela. Although rates may moderate from the current high levels, industry fundamentals over the near to intermediate term are expected to remain favorable. Additional rate increases and long-term charter contracts for quality modern tankers are possible due to environmental concerns after the sinking of the tanker Prestige off the coast of Spain. The global Aframax and Suezmax fleets are expected to increase slightly over the next few years, since the delivery schedule represents a somewhat higher percentage of the existing fleet compared with the capacity of ships over 20 years old that will likely be scrapped.

General Maritime's liquidity available under credit facilities and fairly strong market position should enable the company to maintain a credit profile consistent with the rating. Downside risks are limited by the favorable near to intermediate term industry fundamentals and General Maritime's solid market position. However, dramatic improvements are unlikely due to an aggressive growth strategy in a competitive and cyclical market. Complete ratings information is available to subscribers of RatingsDirect, Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www2.standardandpoors.com; under Fixed Income in the left navigation bar, select Credit Ratings Actions.

www.thestreet.com By Steven Smith Staff Reporter 03/04/2003 06:52 AM EST

Oil, oil everywhere: in the news, on people's minds, filling SUVs, heating homes, monopolizing the business section. And yet, so little profit to be had.

Not to sound like reality TV, but the current environment presents the ultimate challenge: Can anyone find a reasonable, defendable, potentially rewarding way to trade in today's environment, without risking the mother of all losses? Options, as always, will give you a fighting chance.

I know my compatriots on this site have done a great job mapping the current oil landscape. My condensed version is that the prospect of war with Iraq has put a $5 to $6 premium on crude prices.

"There is a lot of panic waiting for not necessarily the outcome, but the initiation of a set of events that will lead to a resolution," said Bill O'Grady, an energy analyst with A.G Edwards.

In the last six months, April crude oil futures have jumped 38.5% to nearly $40 a barrel, more than 17% higher than the June oil future price of $33.10.

But O'Grady is quick to point out that fundamentals, such as a cold winter, turmoil in Venezuela, rising natural gas prices and an overhang of uncertainty, will all lead to an inability to quickly replace lost reserves and increase production capacity. "I see a floor on oil prices somewhere above the $29-per-barrel range for the next 18 months," O'Grady concludes. He thinks that's where the equilibrium will be found as war fears dissipate and positive fundamentals underpin the market.

Unfulfilled Potential

Certainly the oil stocks and their proxies are, for whatever reason, acting poorly in the face of rising oil prices.

Exchange-traded offerings, such as Barclay's iShares' Global Energy Index Fund(IXC:NYSE - news - commentary - research - analysis) and the Merrill Holder Trust Oil Services(OIH:NYSE - news - commentary - research - analysis), have also lagged the market. The business fundamentals are beyond the scope of this article and therefore we will discuss oil futures and options as the purest means to position ourselves to profit from the future direction of oil prices.

That brings us back to the top. Conventional wisdom has it that oil prices will drop some 12% to 15%, or $5, once the U.S invades Iraq. So, that means we will be operating under the thesis that front month (as measured by the April futures) has an embedded war premium of about $5 over June. April options volatility is also running at about 50, or about 5 points higher than June. We assume both will narrow and the price of oil will stay above $30 during the next four months.

Let's see if we can take advantage of the price discrepancy in both the underlying oil price and their related options valuations.

The Trade

On Monday, Light Sweet Crude for delivery in April closed at $37.65 on the New York Mercantile Exchange. Based on settlement prices, one could sell the April $35 call for $3.25 and buy the April $37 call for $1.20 -- otherwise known as the bearish vertical call spread -- for a net credit of $2.05. The thesis is that, given recent events, the price of April oil won't go much above $37.05 by April expiration. The table below shows the risk/reward and break-even.

The risk/reward on this may seem great, but remember we are betting that prices will fall once war breaks out. And we are going to couple this position with a bullish June put spread. This is to incorporate the second half of our thesis: that oil prices should have a floor of around $29 over the next four months. It will also help offset an unexpected rise in price and thereby act as a hedge to our April position.

War-Oil Options

Position Value Net Credit/Debit Max Profit at Less Than $35 Break Even at $37.05 Max Loss at Greater Than $38.25 Sell 1 April $35 call $325 $0 ($205) ($325) Buy 1 April $37 call ($120) $0 $5 $0 Net $205 $205 $0 ($325) Source: TSC Research

June futures closed at $32.80. Sell one June $33 put for $3 and buy one June $30 put for $1.50 for a net credit of $1.50. Without going through all the math, the put position in isolation gives you a maximum profit of $150 per spread if the June futures close above $33. The maximum loss is $150, which is realized at or below $28.50.

But when the two positions are combined, that raises your break-even to $38.55 (thanks to the net credit on the put spread), and lowers the break-even in June to $26.45, thanks to the credit in the April call spread.

And the maximum overall profit increases to $355 should the April/June spread narrow $2 to the $33-$35 range.

www.channelnewsasia.com First created: 04 March 2003 0714 hrs (SST) 2314 hrs (GMT) Last modified: 04 March 2003 1743 hrs (SST) 0943 hrs (GMT)

But dealers said they expected the currency to remain in well-established ranges absent of any major developments in Iraq.

The Institute for Supply Management said its February index slipped to 50.5 in February from 53.9 a month earlier, below expectations of a dip to 52.4.

Analysts say manufacturing is still growing, but it is a real wait-and-see situation.

There is a lot of geopolitical risk, not just in Iraq, but with oil prices up from the strike in Venezuela and North Korea not helping matters.

The single European currency rose to US$1.0890 at 2200 GMT from US$1.0804 late on Friday in New York.

The dollar also eased against the Japanese currency, but dealers were reluctant to sell the dollar aggressively on fears that Japan may intervene to weaken the yen.

The dollar stood at 117.855 yen from 118.11 on Friday.

www.forbes.com Reuters, 03.03.03, 11:55 AM ET By Susan Schneider

NEW YORK, March 3 (Reuters) - Brazilian sovereign bonds edged higher on Monday in thin Carnival holiday trading, as investors remained sanguine about the financial health of Latin America's economic powerhouse and the reform agenda of its new president. Turkey, however, kept a lid on the broader market's gains as its bonds tumbled more than 3 percent, battered by concerns about the economic fallout of parliament's rejection of a U.S. request to station its troops in Turkish territory for a possible U.S-led military strike on Iraq. Brazil's share of the J.P. Morgan Emerging Market Bond Index Plus added 0.53 percent, building on a string of positive days that helped the bonds rack up 7.5 percent in returns last month. The nation's benchmark C bond <BRAZILC=RR> gained 0.125 points to 74.875 bid. While Brazil's markets are closed for much of the week because of the Carnival holiday, leaving the bonds without key cues on the domestic front, the bonds continued to gain ground as investors line up medium-term positions in what is likely to be a top performer for emerging markets this year, said one analyst. "If you look at the high-yielders, where's the competition? Uruguay and Venezuela are plagued by problems; their spreads (over comparable U.S. Treasuries) are very high," said Siobhan Manning, Latin American debt strategist at Italian investment bank Caboto. "Brazil is one of the best with regard to fundamentals," she said. Manning added that cash has recently flowed into Brazil as investors take profits on the sizzling performance of Russian bonds. Brazilian President Luiz Inacio Lula da Silva, in office since Jan. 1, has wooed investors with promises to keep a tight rein on the government's finances and to pursue reforms of the social security and tax regimes. Investors say the reforms are critical for Brazil to shore up its financial health. Still, a number of analysts have questioned how high Brazil's C bond can go. "This week is going to be important because 75-1/2 is a strong resistance level. But pricing will be difficult to interpret because Brazil is basically closed until Thursday," said Manning. Turkey's bonds, meanwhile, careened lower as the Saturday vote unleashed concerns that the nation's economy, still recovering from a fierce recession, would take a severe hit from an Iraqi war without any promise of U.S. aid. The approval of the U.S. troop request would have facilitated up to $30 billion in grants and loan guarantees Turkey has said it needs to compensate for the economic fallout of an Iraqi conflict. Analysts said the vote was negative on several fronts. "The vote puts the country's good relationship with the U.S. at risk and makes the fate of the $6 billion aid package uncertain, (and) the vote reduces the chances that the U.S. will force the (International Monetary Fund) to be lenient in the ongoing IMF negotiations with Turkey," said CSFB in a report. In addition, CSFB said the ruling Justice and Development Party's (AKP) divisions on the issue sent the market the signal that the party may find it difficult to govern in the future. Turkey's share of the EMBI-Plus lost 3.3 percent in terms of daily returns, underpinned by a 4.0 point slump in the nation's benchmark dollar bond <TRGLB30=RR> to 101.75 bid. Peru's bonds also slipped in Monday's session as the nation prepares to reopen its previous 12-year issue bond for up to $250 million, said traders. The nation's portion of the EMBI-Plus shed 0.42 percent on the day. On Monday, Peru's government authorized the reopening of last month's $500 million, 12-year global bond, which sold at 5.77 percentage points over the comparable 12-year U.S. Treasury with a yield of 10.10 percent and a coupon of 9-7/8. "This has hit the market a little bit," said an emerging debt trader of Peru's planned issue. The broader EMBI-Plus move a bare 0.12 percent higher on the day.