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The Difference Between a Duncan and a Lay

By Stansberry Research Interview Series
Wednesday, July 26, 2006

Dan Duncan is someone you can trust.
 
Duncan started the second biggest “midstream” natural gas company in the USA back in 1968 with $10,000 and a couple of trucks.
 
In 1968, there were already plenty of natural gas explorers and producers. But nobody was devoted to natural gas’s midstream operations: the transportation, storage, and processing of the stuff.
 
Duncan was one of the first to fill the void. Within five years, his two-truck outfit, Enterprise Products, had grown into a $3 million company. And over the next twenty years, Duncan shifted the company’s focus from trucks to pipelines... growing into a multi-billion dollar powerhouse.
 
He took the company public as a master limited partnership in 1998. Soon after, Enterprise went on a spending spree. The company spent $7 billion in six year's time buying up pipelines, storage facilities and processing centers on the cheap from companies that had collapsed from accounting scandals similar to Enron.
 
The difference between these scandal-ridden companies and Enterprise?
 
Management.
 
Enterprise has made Duncan a billionaire several times over. Forbes now ranks him as the 100th richest man in the world with a net worth of $6 billion. Yet, rather than using this personal fortune to branch out into new industries, Duncan has repeatedly plowed more of his own money into Enterprise’s stock.
 
In 2004, he bought $49 million worth. In 2005, he was back for another $10 million. And so far in 2006, he’s bought $5.6 million.
 
Contrast this with Enron, whose insiders sold over $1 billion in stock while claiming the company had nothing to hide prior to the discovery of its accounting scandals.
 
Found a growth stock you want to sink some money into? Check out what its insiders are doing with their own money. It’s the only way to differentiate between the Duncans and the Lays of the world.
 
Good trading,
 
Graham




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Market Notes
Earnings today: Anheuser-Busch, ConocoPhillips, General Motors, Meritage Homes, Norfolk Southern, Phelps Dodge, Pulte Homes, Reynolds American, Boeing.
 
Big Pharma new highs: Merck, Bristol Myers Squibb, Sanofi-Aventis.
 
Investor’s Intelligence survey of market pros still massively bearish.
Market Watch
Symbol Price
Change
52-Wk
S&P 500 1221.53 +1.3% +10.1%
Oil 38.31 +1.4% -0.6%
Gold 138.07 +2.1% +16.3%
Silver 28.60 +2.4% +53.6%
US-Dollar 80.67 -0.8% +8.1%
Euro 1.32 +0.6% -12.1%
Volatility 18.01 -7.1% -19.8%
Gold Stocks 581.56 +3.0% +17.0%
10-Year Yield 3.02 +0.7% -10.7%

World ETFs
Symbol Price
Change
52-Wk
USA 122.89 +0.3% +11.3%
Canada 30.50 +0.2% +16.2%
Russia 21.94 +1.4% +18.1%
India 37.85 +0.3% +22.3%
Israel 16.69 +1.3% +10.8%
Japan 10.64 +0.6% +6.5%
Singapore 13.73 -1.1% +18.8%
Taiwan 14.78 +0.4% +19.2%
S. Korea 57.31 +1.3% +23.4%
S. Africa 71.87 +1.4% +28.2%
China 44.42 -1.4% -0.6%
Lat.America 53.17 +0.7% +8.4%

Sector ETFs
Symbol Price
Change
52-Wk
Oil Service 137.59 +1.0% +18.9%
Big Pharma 64.14 +0.0% -3.2%
Internet 72.07 -0.1% +23.4%
Semis 16.22 +1.2% +29.4%
Utilities 31.28 +0.2% +1.5%
Defense 18.52 +0.1% +10.6%
Nanotech 10.03 +0.4% +1.6%
Alt. Energy 10.08 +1.3% -3.3%
Water 18.49 +1.0% +14.5%
Insurance 16.14 +0.4% +21.1%
Biotech 20.54 -0.2% +28.1%
Retail 19.70 +0.3% +30.2%
Software 24.79 +0.8% +25.9%
Big Tech 53.87 +0.3% +22.7%
Construction 13.10 +0.9% +15.7%
Media 13.64 +0.5% +26.0%
Consumer Svcs 67.39 +0.2% +24.5%
Financials 55.04 +0.3% +7.4%
Health Care 64.30 +0.1% +2.0%
Industrials 63.54 +0.5% +21.0%
Basic Mat 74.35 +1.1% +25.3%
Real Estate 55.32 +0.1% +25.0%
Transportation 91.77 +0.7% +26.9%
Telecom 22.59 +0.5% +17.8%