Good Monday Morning! Abbreviated Edition. IMPACT CALLS Internet Security Israel Hernandez Company Updates/Rating Changes q Investment Conclusion: Below are specific company updates and our views on each company in our coverage universe. Reiterating our thoughts published on September 17, we believe last week's attacks are likely to cause numerous short-term disruptions that put the September quarter at risk for all the security software vendors, particularly those vulnerable to discretionary spending cuts or large deals. In light of recent events, we are adjusting our ratings on two companies. We are raising our rating on VeriSign from a 2-Buy to 1-Strong Buy based on good earnings visibility amid a generally uncertain outlook for most software vendors. We are also lowering our rating on Internet Security Systems from a 1-Strong Buy to 2-Buy to adjust for these uncertainties and lack of visibility. While valuations for many of the companies are starting to look interesting, as a whole, we remain somewhat cautious on the security software vendors given the uncertainties introduced into the market over the last two weeks which could lead to more downward revisions in the September and December quarters and spill over in the first quarter of 2002. Internet Secuirty Systems Israel Hernandez Downgrading from Strong Buy to Buy 2 - Buy / $13.00 (USD) q We are downgrading ISSX from a 1- Strong Buy to a 2-Buy rating to reflect the lack of near-term visibility, and changing economic backdrop that increases the likelihood of a potential shortfall to our Q3 forecast. q Given the events of the past two weeks, we believe ISS and other security software vendors may run into difficulty closing business in a back-end loaded September quarter. q We are lowering our price target from $35 to $20, or 4 x FY01 revenues of $223M, to reflect the increased economic uncertainty in the current environment. VeriSign Inc Israel Hernandez Upgrading to Strong Buy from Buy 1 - Strong Buy / $38.30 (USD) q Given VeriSign's strong revenue visibility in a period of global economic uncertainty, we are raising our rating from 2-Buy to 1-Strong Buy making it our top pick in the sector. q In light of the global slowdown, we believe VeriSign provides investors with exceptional earnings visibility given its services model and strong deferred revenue balance. This visibility should enable VeriSign to sustain a premium valuation and outperform most technology stocks, even in a contracting environment. q We believe new value added services laid on top of a relatively fixed cost structure will provide significant margin expansion, currently at 14.6% and growing to the low thirties in the next 2 years. Oil & Gas: Exploration & Production Thomas R. Driscoll Some E&P Shares Now Appear Attractive q We are lowering our natural gas price forecasts as well as revising target prices and codes for the large-cap oil exploration and production companies we cover. We now believe that several companies we cover offer compelling values today. As a result we are upgrading our ratings on the shares of EOG Resources (EOG), Noble Affiliates (NBL) and Pioneer Natural Resources (PXD) from 2-Buy to 1-Strong Buy. We are also downgrading our code on the shares of Devon Energy (DVN) from 2-Buy to 3-Outperfrom to reflect heightened concerns about the increased debt load that will result from recently announced acquisitions. We are also downgrading our codes on Vintage Petroleum (VPI) from 1-Strong Buy to 2-Buy. AOL Time Warner Holly Becker Fund. Remain Strong In Unstable Environm 2 - Buy / $29.25 (USD) q The economic and advertising slowdown has obviously been compounded by recent tragic events. AOL Time Warner remains the premier integrated media company with a uniquely valuable portfolio of assets. While near-term estimates may need to come down further, we view the stock's pullback as a compelling buying opportunity. q AOL Time Warner's core businesses offer investors superior earnings power and growth, while new cross-platform initiatives should propel the company's long-term growth rate to above industry norms. q Advertising represents only 25% of revenue, considerably lower than comparable companies including Viacom (45%) and Disney (30%). Gaming & Lodging Joyce Minor Rich Bottom Fishing, But Dangerous Water q The gaming and lodging sectors saw huge downside moves last week, with the large cap gaming stocks down an average of -33% and the lodging stocks down an average of
Q: What is a potential subject line for this email?
answer: The Morning Market Call - Monday September 24th, 2001.
Mark Haedicke will hold a floor meeting for EWS Legal in Houston this afternoon, Monday, November 12, at 2:00 p.m. The location will be outside of conference room EB3824. Please plan to attend. Thank you.
Answer: Floor Meeting for EWS Legal
Here is an email: Dear Greg, I appreciate you coming down to the gas floor and providing us some information about what is going on. One of the questions that kept getting asked had to do with who will be retained, and what we will be paid when we are retained. We were told that star performers will be retained. At what profit level do we become star performers? I understand you and your staff have a tremendous number of things that need to be accomplished. As I talk with my peers, the most important thing on our minds is if we will have a job and what we will be paid. John was saying that in a few months this issue would be addressed. My immediate concern is to secure employment while there are still positions available with other companies. I will accept the first lucrative offer that is made to me. My peers have expressed the same sentiment. In a few months, there may not be any jobs left. We have to may hay while the sun shines. We all have been bombarded with calls from executive search firms. We are all racing for a limited number of jobs that promise substantially higher salaries. What we need on this floor is some assurances. Maybe it should be in the form of granting bonuses now and offering employment contracts. We need some exact numbers in the form of dates, salaries, and bonus plans. Scott Neal brought up this same question several times and John said he understood how critical this situation is. If there are only trader track personnel left to run this company, will Dynegy still be interested? Getting a bonus this year that reflects the work I put in is critical. It is no where near as critical the issue of making sure my children have food on the table. I do not have two months to wait to find out that the compensation I will be offered ends up being less than what a third party is willing to pay, or the bonus program is a based on a amount to appease me when I may have passed up a percentage deal. Please sense the urgency that my peers and I are feeling. Tom Donohoe
What is a potential subject line for this email?
A: Employee retainment
Q: All, We currently have 7 associates and 2 analysts yet to place in ENA. These A&A are new hires and will be joining Enron in August. Please advise me if you would like to see these resumes today. Rgds, Karen. x54667
Propose a subject line
A: A&A to be placed
IN: This is an email
Tom, Below is a copy of the Weekly Report from October 8 through October 12, 2001. Please note a few changes from last weeks report. The Potential Revenue Generating transaction count as well as the Potential Revenue from those transactions has changed to reflect new Nom Logic Pricing as discussed last week. An amendment template has been created and will be sent to customers for discussion purposes at the appropriate time in the revisions process. We will monitor customers who have received this template in the upcoming weekly reports. Finally, we have included a new table in the report which reflects our Counterparties Current Trading Agreement Status. This will include a reporting of which companies have ISDA Agreements, ENA Agreements, Counterparty Agreements, or No agreements in place which should give us a more accurate idea of where our hang ups will be in the legal process. If you have any questions, please let me know. Thanks

What is the subject?

OUT:
Weekly Marketing Report 8-12Oct01.xls