Top Five Large-Cap Stocks: July 16

Although sequential revenue gains were dampened in the first quarter as a result of seasonal factors and weather-related events, management announced that various factors indicate that growth should strengthen as the year progresses in the absence of a severe global recession. The company's future financial performance could be negatively impacted by a steep drop in demand if such a recession were to occur.

Additionally, the rise in Schlumberger's stock price over the past year has driven the stock to a level that is at a premium when compared with the rest of the industry, but we feel that the company's strengths justify the higher price levels.

Hess Corporation(HES Quote) is a global independent energy company that explores for, produces, purchases, transports, and sells crude oil and natural gas. The company conducts exploration and production activities in countries worldwide, including the U.States, the United Kingdom, Norway, Denmark, Equatorial Guinea, Gabon, Azerbaijan, Thailand, and Indonesia. The company also manufactures, purchases, trades, and markets refined petroleum and other energy products. Hess operates approximately 1,250 retail facilities in the eastern United States, along with a convenience store network.

We have rated Hess a buy since August 2004 because of a variety of strengths. Propelled by price increases for natural gas, natural gas liquids and oil, the company's total revenue and non-operating income for the first quarter of fiscal 2008 rose 45.4% year over year. An increase in the company's average daily production of natural gas and crude oil also contributed to the improvement in total revenue and non-operating income. Hess also announced that its first quarter net income surged to 105.1% to $759 million from $370 million a year ago, again because of higher crude oil prices and increased production. Additionally, net operating income increased significantly in the first quarter, rising 84.03% when compared with the same quarter last year.