Huge reserves, cheap stock.

good drilling prospects

local

Plains Exploration & Production (PXP) was upgraded at UBS. Rating raised to Buy from Neutral. 2008 EPS estimates raised to $14.68 from $12.66. Price target raised to $80 from $75.

Buy -- Price 62.53 on April 14
by Coker & Palmer
California environmental groups ... signed an agreement with PXP allowing for development of offshore Tranquillon Ridge... . While other approvals remain, [this] is significant ... by 2022, PXP could produce 119 [million barrels of fuel-oil equivalent], about $20 a share... . We're increasing "08 target to 80 from 70, based on "08 enterprise value[earnings before interest, taxes, depreciation, amortization] of 8.2 times. Market cap: $7 billion.

Plains Exploration announced recently that its board approved a $1 billion share repurchase. The plan replaces an existing buyback with $158 million remaining.

The oil and gas producer also recently announced that it agreed to sell $1.75 billion in oil and gas properties to subsidiaries of Occidental Petroleum Corp. and XTO Energy Inc.

The stock trades for 10x cash flow.

Plains Exploration (PXP) was upgraded from Equal-weight to Overweight, Morgan Stanley said. $65 price target. Stock is down 4% on the year, and the company's legacy oil assets could drive earnings in 2008.

Buy - Price 46.78 on Oct. 10
by Sterne Agee
Target: 60. Fir Tree Partners announced that it would support PXP's acquisition of Pogo Producing (PPP). Several weeks ago, Fir Tree had sent a letter to PXP that said it would oppose the acquisition....With the now probable success of the acquisition of PPP, the number of shares increases from about 72 million to about 114 million in 4Q07. We have been informed by PXP that they own roughly 30% of the total Flatrock wells. If the Flatrock area totals 1.5 tcf [trillion cubic feet] in reserves and those reserves were to be sold for $3 to $3.25 per mcf [thousand cubic feet], the discovery is now worth about $12 per share to PXP. Our $60 target price equates to 38 and 8.2 times our 2007 estimated EPS and Ebitda [earnings before interest, taxes, deprecation and amortization], respectively.

Cheap and stable Real Estate REIT with decent yield

"Shareholder Fir Tree plans to vote against the company's pending purchase of Pogo Producing (PPP). In a letter to Plains Exploration, Fir Tree said the deal is no longer attractive, because of recent turmoil in the credit markets and because Plains Exploration is so undervalued. Fir Tree said that Plains Exploration, an energy company, could generate more than $1 billion in aftertax proceeds from the "opportunistic" sale of its noncore assets. Without doing the deal, the company could also buy back 20 million to 25 million of its shares, Fir Tree said.

If Plains Exploration successfully forms an upstream master limited partnership, its shares could be worth $70 to $75, Fir Tree said in the letter. Fir Tree reported ownership of 6,651,600 shares (9.1% of the total outstanding)"