THE

ALUE LINE
Investment Survey

ISSUE 3

Part 3

Ratings
&
Reports

www.valueline.com
PAGE

PAGE

Intl Flavors & Fragrances ............... 562

Kronos Worldwide, Inc. .................... 563
Minerals Technologies Inc. ............... 564
NewMarket Corp. ............................. 565
OM Group, Inc. ................................. 566
Park Electrochemical ........................ 567
Penford Corp. .................................... 568
Praxair, Inc. ....................................... 569
Quaker Chemical .............................. 570
RPM Intl ........................................... 571
Schulman (A.), Inc. ........................... 572
Sigma-Aldrich .................................... 573
Solutia Inc. ........................................ 574
Tredegar Corp. .................................. 575
Valspar Corp. .................................... 576
Westlake Chemical Corp. ................. 577

NATURAL GAS
(DIVERSIFIED) INDUSTRY ............... 520
Cabot Oil & Gas ............................... 521
Chesapeake Energy Corp. ................ 522
Cimarex Energy Co. .......................... 523
Crosstex Energy, Inc. ........................ 524
Devon Energy Corp. .......................... 525
EOG Resources, Inc. ......................... 526
EQT Corp. ......................................... 527
EnCana Corp. ................................... 528
Energen Corp. ................................... 529
LINN Energy, LLC ........................... 530
MDU Resources Group, Inc. ............. 531
National Fuel Gas ............................ 532
Newfield Exploration Co. ................. 533
Pengrowth Energy ............................. 534
QEP Resources, Inc. ......................... 535
Questar Corp. ................................... 536
Quicksilver Resources ....................... 537
Southwestern Energy ........................ 538
Talisman Energy Inc. ........................ 539
NATURAL GAS UTILITY
INDUSTRY .............................................. 540
AGL Resources Inc. .......................... 541
Atmos Energy Corp. .......................... 542
Laclede Group ................................... 543
New Jersey Resources ...................... 544
NiSource Inc. ..................................... 545
Northwest Natural Gas ................... 546
Piedmont Natural Gas ..................... 547
South Jersey Industries, Inc. ........... 548
Southwest Gas .................................. 549
UGI Corp. .......................................... 550
WGL Holdings, Inc. .......................... 551
CHEMICAL
(SPECIALTY) INDUSTRY ................... 552
Airgas, Inc. ........................................ 553
American Vanguard Corp. ................ 554
Ashland Inc. ...................................... 555
Avery Dennison Corp. ....................... 556
Cabot Microelectronics Corp. ............ 557
Ceradyne, Inc. ................................... 558
Ecolab Inc. ......................................... 559
Ferro Corp. ........................................ 560
Fuller (H.B.) ...................................... 561

File in the binder in order of

issue number, removing
previous issue bearing
the same number.

June 8, 2012

PETROLEUM
(INTEGRATED) INDUSTRY ................ 501
BP p.l.c. (ADR) ................................. 502
Chevron Corp. ................................... 503
ConocoPhillips ................................... 504
Exxon Mobil Corp. ............................. 505
Hess Corp. ......................................... 506
HollyFrontier Corporation ................ 507
Imperial Oil Ltd. .............................. 508
Marathon Petroleum Corp. .............. 509
Murphy Oil Corp. .............................. 510
Occidental Petroleum ....................... 511
Petroleo Brasileiro S.A. (ADR) ....... 512
Phillips 66 ......................................... 513
Royal Dutch Shell A ......................... 514
Suncor Energy Inc. ............................ 515
Sunoco, Inc. ....................................... 516
Tesoro Corp. ...................................... 517
Total (ADR) ....................................... 518
Valero Energy Corp. .......................... 519

Pages 500-634

WIRELESS NETWORKING
INDUSTRY .............................................. 578
AboveNet, Inc. ................................... 579
American Tower A ........................... 580
Brightpoint, Inc. ................................ 581
Crown Castle Intl Inc. ..................... 582
DSP Group, Inc. ................................ 583
Echelon Corp. .................................... 584
Finisar Corporation .......................... 585
InterDigital, Inc. ............................... 586
Intermec, Inc. .................................... 587
Itron, Inc. .......................................... 588
Powerwave Technologies, Inc. .......... 589
RF Micro Devices, Inc. ...................... 590
Research In Motion Ltd. ................... 591
SBA Communications ....................... 592
Smith Micro Software, Inc. ............... 593
ViaSat, Inc. ....................................... 594
Zebra Technologies Corp. ................. 595
COAL INDUSTRY .................................. 596
Alliance Resource Partners, L.P. ..... 597
Alpha Natural Resources, Inc. ......... 598
Arch Coal, Inc. ................................... 599
CONSOL Energy Inc. ........................ 600
Joy Global Inc. .................................. 601
Natural Resource Partners L.P. ...... 602
Peabody Energy Corp. ...................... 603
Penn Virginia Resource Partners ..... 604
Rhino Resource Partners LP ............ 605
Walter Energy, Inc. ........................... 606
OIL/GAS DISTRIBUTION
INDUSTRY .............................................. 607
Clean Energy Fuels Corp. ................ 608
Copano Energy, L.L.C. ..................... 609
Enbridge Inc. ..................................... 610
ONEOK, Inc. ..................................... 611
Pembina Pipeline Corp. ................... 612
Spectra Energy Corp. ........................ 613
TransCanada Corp. .......................... 614
Williams Cos. .................................... 615
PIPELINE MLPS INDUSTRY ............ 616
Boardwalk Pipeline Partners, L.P. . 617
Buckeye Partners, L.P. ..................... 618
El Paso Pipeline Partners, L.P. ....... 619
Energy Transfer Partners, L.P. ........ 620
Enterprise Products Partners, L.P. 621
Inergy, L.P. ........................................ 622
Kinder Morgan Energy Partners ...... 623

ESPECIALLY NOTEWORTHY:
With this weeks issue, we welcome oil
refiner Phillips 66 to the Petroleum
(Integrated) Industry on page 513. The
company was recently separated from
ConocoPhillips (page 504), which now
focuses on drilling.
Also coming on board is Rhino
Resource Partners LP, located on page
605 in the Coal Industry.
EOG Resources (page 526) is achieving impressive results at its up-and-coming North American drilling sites.
Energy Transfer Partners (page 620)
has been making a number of moves recently, including its planned acquisition
of Sunoco (page 516).
Royal Dutch Shell (page 514) is
considering raising its bid to buy a company with interests in East African natural gas fields. The move could be a
prelude to setting up a major exporting
hub in the region.
Kronos Worldwide has something for
almost everyone. For more on this chemical manufacturers investment merits,
turn to page 563.
Strength in the farm sector and the need
for more efficient farming augur well for
American Vanguard. Page 554.
Positive near-term prospects, along with
an expansion program to drive growth,
make Suncor Energy (page 515) a good
selection for both momentum and longterm investors.
Imperial Oils diversified asset base
positions it well to register strong results
once oil prices resume their ascent. Our
full report can be found on page 508.

Magellan Midstream Partners, L.P. 624

Plains All American Pipeline, L.P. ... 625
Suburban Propane Partners, L.P. ... 626
Williams Partners L.P. .................... 627
SUPPLEMENTARY REPORTS .......... 634

Rank 1 (Highest) for Timeliness.

Rank 2 (Above Average).

In three parts: Part 1 is the Summary & Index. Part 2 is Selection & Opinion. This is Part 3, Ratings & Reports. Volume LXVII, No. 42
Published weekly by VALUE LINE PUBLISHING LLC, 220 East 42nd Street, New York, NY 10017-5891
2012, Value Line Publishing LLC. All rights reserved. Factual material is obtained from sources believed to be reliable and is provided without warranties of any kind. THE PUBLISHER
IS NOT RESPONSIBLE FOR ANY ERRORS OR OMISSIONS HEREIN. This publication is strictly for each subscribers own, non-commercial, internal use. No part of this publication
may be reproduced, resold, stored or transmitted in any printed, electronic or other form, or used for generating or marketing any printed or electronic publication, service or product.

See back cover for important disclosures.

ECONOMIC SERIES

June 8, 2012

Value Lines estimates of sales and earnings growth for individual

companies are derived by correlating sales, earnings, and dividends to appropriate components or subcomponents of the Gross
Domestic Product, presented below. A more detailed forecast appears periodically in Selection & Opinion.
HYPOTHESIZED ECONOMIC
ENVIRONMENT 3 TO 5 YEARS HENCE
The hypothesized 2015-2017 economic environment into which
earnings are forecast is as follows: Unemployment will average
about 6.5% of the national labor force. There will be no major war
in progress at that time. Industrial production will be expanding
by about 3.5% per year. Inflation will continue to be modest. Prices
as measured by the broad-based GDP deflator will advance by

500

almost 2% per year on average. The corporate income tax rate

will be around 35%. Long-term interest rates on high-grade corporate bonds are projected to average 6% in the years 2015-2017.
We expect the Federal Reserve to pursue neutral-to-fairly accommodative policies except in years in which the economy is overheating. Based on these assumptions, the Gross Domestic Product will average $18,823 billion in the years 2015-2017, a level that
is nearly 25% above the 2011 total of $15,088 billion.
Things may turn out differently. But in the absence of knowledge
of the future, we use the above assumptions, which appear to be
most plausible. Thus we are able to apply a common economic
environment to all stocks for the purpose of measuring relative
growth potential.

THESE ARE THE NATIONAL INCOME SERIES TO WHICH VALUE LINE SALES, EARNINGS, AND DIVIDEND ESTIMATES ARE CORRELATED
ANNUAL STATISTICS
Gross Domestic Product ($Bill.)
Real GDP (2005 Chained $Bill.)
Total Consumption ($Bill.)
Nonresidential Fixed Investment ($Bill.)

2001
10286
11347
7149
1228

2002
10642
11553
7439
1125

2003
11142
11840
7804
1136

2004
11868
12264
8533
1263

2005
12638
12638
8819
1347

2006
13399
12976
9074
1454

2007
14062
13229
9314
1544

2008
14369
13229
9265
1557

2009
14119
12881
9154
1291

2010
14527
13088
9221
1319

2011
15088
13315
9421
1436

2012*
15639
13616
9645
1519

-3.4
1.60
17.1
2.7
4.7

-0.1
1.71
16.8
3.5
5.8

1.3
1.85
16.6
3.5
6.0

2.5
1.95
16.9
2.1
5.5

3.3
2.07
17.0
0.4
5.1

2.2
1.81
16.5
0.7
4.6

1.7
1.34
16.1
0.6
4.6

-2.2
0.90
13.1
1.8
5.8

-9.3
0.55
10.4
5.9
9.3

5.3
0.59
11.6
5.3
9.6

4.1
0.61
12.7
4.7
9.0

4.0
0.75
14.3
4.0
8.1

3.3
1.00
14.9
3.5
7.8

3.5
1.60
16.5
4.5
6.5

AAA Corp Bond Rate (%)

10-Year Treasury Note Rate (%)
3-Month Treasury Bill Rate (%)

7.1
5.0
3.4

6.5
4.6
1.6

5.7
4.0
1.0

5.6
4.3
1.4

5.2
4.3
3.1

5.6
4.8
4.7

5.6
4.6
4.4

5.6
3.7
1.4

5.3
3.3
0.2

4.9
3.2
0.1

4.6
2.8
0.1

4.0
2.1
0.1

4.4
2.6
0.1

6.0
4.5
3.0

ANNUAL RATES OF CHANGE

Real GDP
GDP Deflator
Consumer Price Index

1.1
2.3
2.8

1.8
1.6
1.6

2.5
2.2
2.3

3.6
2.9
2.7

3.1
3.3
3.4

2.7
3.2
3.2

2.1
2.7
2.9

0.4
2.2
3.8

-2.6
0.9
-0.3

3.0
1.2
1.6

1.7
2.1
3.1

2.3
1.4
1.9

2.5
1.5
2.1

3.3
1.8
2.5

1st
14868
13228
9377
1379

2nd
15013
13272
9393
1413

3rd
15176
13332
9434
1466

4th
15294
13429
9482
1484

1st*
15435
13502
9550
1476

2nd*
15565
13576
9614
1505

3rd*
15705
13653
9678
1534

4th*
15849
13731
9738
1560

1st*
15995
13809
9796
1576

2nd*
16158
13898
9852
1602

3rd*
16331
13995
9908
1630

4th*
16513
14098
9962
1660

4.4
0.58
13.0

1.2
0.57
12.1

5.6
0.62
12.5

5.0
0.67
13.4

4.0
0.71
14.5

5.0
0.73
14.5

4.0
0.75
14.2

3.0
0.80
14.0

3.0
0.85
14.5

3.0
0.95
14.8

3.5
1.05
15.0

3.5
1.15
15.2

IIndustrial Prod. (% Change, Annualized)

Housing Starts (Mill. Units)
Total Light Vehicle Sales (Mill. Units)
Personal Savings Rate (%)
National Unemployment Rate (%)

QUARTERLY ANNUALIZED RATES

Gross Domestic Product ($Bill.)
Real GDP (2005 Chained $Bill.)
Total Consumption ($Bill.)
Nonresidential Fixed Investment ($Bill.)
Industrial Production (% Change, Annualized)
Housing Starts (Mill. Units)
Total Light Vehicle Sales (Mill. Units)

2011

2012

2013* 2015-17*
16249
18823
13950
15318
9879
10567
1617
1944

2013

*Estimated

Arnold Bernhard, Founder (1901-1987)

Harvey S. Katz, Managing Editor
Theresa Brophy, Assoc. Director of Research
Charles Clark, Assoc. Director of Research

Editorial Analysts:
Sharif Abdou
Erik A. Antonson
Jeremy J. Butler
Paul E. Debbas
Kevin Downing
J. Susan Ferrara
Richard Gallagher
Robert M. Greene
Justin Hellman
Alan G. House
Erik M. Manning
Kenneth A. Nugent
Adam Rosner
Randy Shrikishun
Craig Sirois
Matthew E. Spencer

Senior Analysts:
David R. Cohen
Andre J. Costanza
Iason Dalavagas
Bryan J. Fong
Frederick L. Harris, III
Jerome H. Kaplan
Michael F. Napoli
Michael Ratty
Sigourney B. Romaine
Orly Seidman
Simon R. Shoucair
Dominic B. Silva

Ian Gendler, Director of Research

Robert Mitkowski, Jr., Assoc. Director of Research
Mario Ferro, Assoc. Director of Research
William G. Ferguson, Assoc. Director of Research

Analysts:
Marija Dabovic
Kenneth J. DeFranco, Jr.
Kathryn M. Drew
Nira Maharaj
Joel Schwed
Simon E. Shnayder
Steven Shnayder
Sahana Zutshi

Data Administration:
Curtis R. Clarke, Manager, Equity Data Div.
Dana Jones, Database Analyst
Marizol Polanco, Database Analyst
Patrick G. OConnor, Supervisor, Quality Ctrl.
Frantz Goodridge, Research Assistant
Clive Russell, Research Assistant

Junior Analysts:
Geoffrey C. Bell
Andrew J. Cueter
Robert L. Harrington III
Michelle Jensen
Marek Mscichowski
Nicholas P. Patrikis
Adam J. Platt
Robert J. Scrudato
Eugene Varghese

Production:
LeShane W. Lilly, Production Manager
Michael Manchess, Production Coordinator
Warren Tabachnick, Production Editor

George Gu, Director, Quantitative Research

Harold Levine, Director, Statistical Services

Information Technology:
Christine M. Gould, Chief Digital Officer
Hassan Davis, Director,
Advanced Information Technology
Donna Webb, Manager of Production Control

Howard Brecher, President & Publisher

2012, Value Line Publishing LLC. All rights reserved. Factual material is obtained from sources believed to be reliable and is provided without warranties of any kind.
THE PUBLISHER IS NOT RESPONSIBLE FOR ANY ERRORS OR OMISSIONS HEREIN. This publication is strictly for subscriber's own, non-commercial, internal use. No part of it
may be reproduced, resold, stored or transmitted in any printed, electronic or other form, or used for generating or marketing any printed or electronic publication, service or product.

To subscribe call 1-800-833-0046.