S.A. Advisory E-Mail Update

August 10,1998

Subject: Major Buy Recommendation on the Oil Patch part #2

Dear E-mailer's: http://www.saadvisory.com

In our last e-mail we informed our readers that in our opinion ,the whole oil sector was extremely oversold, overlooked and seriously undervalued! At that time we featured and recommended a few opps. ( apa, keg & hp ) . We have decided to add additional oil related issues to our list and form a portfolio of issues that in our opinion will deliver HUGE gains for the patient investor during the next 6 to 18 months!! We have never been as bullish towards this group in the 15 years that S.A. Advisory has been in business! We intend to monitor this group for percentage gain performance in.


Apache corp    apa   8/03/98    $25.75    producer O%G $19.27 $1.22  .81/dec98

Benton O&G     bno   8/10/98    $8.375    producer O&G  $6.00 $5.22 -.74/dec98

BJ Services    bjs   8/10/98    $20.25    oil services  $12.8 $.03 $1.89/sep98

Diamond Off    do    8/10/98    $30.625   drill offshore$12.14$2.76$2.77/dec98

Halliburotn    hal   8/10/98    $33.50    oil service   $10.23 $.03$2.12/dec98

Helmerich & P  hp    8/03/98    $20.18  produce & drill  $16.27$.73$1.57/sep98

Key Energy     keg   8/03/98    $10.69     oil services  $8.03$1.47$1.22/jun98

Seagull        sgo   8/10/98    $12.94    producer O&G   $10.32 $.28 .11/dec98

Smith Int.     sii    8/10/98   $26.12      oil service  $12.53$.68$2.73/dec98

Tidewater      tdw    8/10/98   $28.18  service offshore $17.56$.76$3.79/mar98

Transocean     rig    8/10/98   $35.44  driller offshore$17.06$.58 $2.86/dec98

UTI Energy     uti    8/10/98   $9.625   domestic driller $8.70$2.74$.90/dec98

Part II

Company    52-week range      P/S        total debt/equity(mrq) most recent qt

apa          24.50-45.06      2.10            .73

bno          7.375-21.87      1.46            1.60

bjs          17.75-45.37       .99             .28

do           28.56-67.50      3.78             .24

hal          30.69-67.50       .90             .20

hp           19.25-45.56      1.74              00

keg           9.50-38.87       .45             2.42

sgo           11.375-27.625    1.47             .72

sii           22.81-87.875     .58              .75

tdw           25.00-70.50      1.44             .04

rig           33.125-60.50     3.61             .46

uti           8.00-48.625       .69             .17

We intend to monitor 1000 shares of each investment opp. for % gain performance! Our starting valuation equals $261,680.00!


We have believed for quite some time that the "DOW" was and still is overvalued and the nasdaq and otc stocks have been undervalued! We don't believe that a BEAR market has begun! We still have low interest rates, very low inflation and high consumer confidence. In our opinion the key to successful investing is to buy fundamentally cheap and out-of-favor investments. We believe that for the near term most third tier otc's will remain out-of-favor until the second and first tier nasdaq's start to appreciate. We are not negative on the third tier, but assume little action within the group and one might assume that tax selling might depress the group even further. If a small stock does not receive any promo it is just going to sit! The motivation for all small-caps is EARNINGS! Long Term SETO, PCSH, EPLN,TGCN,SCTI,CBLK,ISOL,WEBP and others looks attractive--patience is the KEY for successful investing in this group..

Finally, our main theme of this e-mail is the oils and related issues--PLEASE take a serious look!! OIL & GAS will not remain at depressed levels forever so be positioned today for tomorrows PROFITS! .

Yours truly, William Velmer http://www.saadvisory.com

PS: Next hardcopy newsletter coming soon!

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