Frontier Oil Corp (FTO) -- Company Highlight and Chart

By Steve Cook
All American Investor

Frontier Oil Corp (FTO) is an independent energy engaged in crude oil refining and wholesale marketing of refined petroleum products. The company has grown profits and dividends in excess of 30% annually over the past five years though its return on equity has declined dramatically from 40%+ to the 10-11% range. While profits fell significantly in 2008 and 2009, earnings are recovering in 2010 and should continue to grow as a result of:

(1) an aggressive capital expenditure program that has dramatically increased both the capacity and performance of its refining facilities,

(2) its ability to process heavier, less expensive types of crude oil while still producing higher value added refined products,

(3) wider margins resulting from stabilizing demand and lower raw material, freight and other costs,

FTO is rated B+ by Value Line, has a 28% debt to equity ratio and its stock yields 1.4%.

Leggett & Platt (LEG) Company Highlight

By Steve Cook
All American Investor

Leggett & Platt (LEG) is a manufacturer of bedding components, residential and office furniture, store fixtures, displays, die castings, specialty wire products, auto seating control cable systems. LEG’s profits have shown little growth over the past 10 years though dividends have increased at an 11%+ rate. Return on equity has been a modest varied from 10-11% earlier in the decade to 6-7% recently. The company has suffered with others producing for the consumer durables industry; however, earnings appear to have stabilized and are expected to pick up in the next couple of years because: