Most stocks based in Oklahoma lose value in 2008
ECONOMYMOST STOCKS BASED IN OKLAHOMA LOSE VALUE IN 2008

BY DON MECOY Comments 0
Published: January 1, 2009

Oklahoma stock watchers described 2008 this way: Painful. Brutal. Challenging. Grueling. Merciless.

David Rainbolt, chief executive officer of BancFirst Corp. Photo provided

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In a year when the major stock indices registered losses not seen since the Great Depression, most Oklahoma companies shared in the pain.

Only two of the 51 state-based stocks that traded on major exchanges during 2008 ended the year with gains. Meanwhile, 22 Oklahoma stocks lost more than half their value during the year.

"A tough, brutal year which I hope we never revisit,” Tulsa money manager Fred Russell said.

The carnage and its causes have been well-documented: Ill-advised loans that toppled over-leveraged financial entities and prompted a freeze in the credit markets that power the world’s economies.

"It has been the perfect storm,” said Bob Rader, executive vice president with Capital West Securities in Oklahoma City. "It has come in from every direction. It made no difference. The bluest of the blue chips are way down.”

Few winners

In a year when some of the world’s financial giants fell, an Oklahoma financial company rose to the top.

BancFirst Corp., parent of BancFirst, posted a 23.5 percent gain. Chief Executive Officer David Rainbolt attributed the positive year to the company’s conservative approach.

"It virtually guarantees that we’re not going to be the darling bank stock in the middle of a boom,” Rainbolt said. "The good thing is we should perform reasonably well in poor economies.”

However, Rainbolt said the recession will affect BancFirst in the coming year.

"It will be rough,” he said "Our earnings are certainly going to be affected — maybe not to the same extent as some, but we’re going to be affected.”

AAON Inc, a Tulsa commercial heating and air conditioning manufacturer, was the only other state-based public company that registered a gain in 2008, posting a 5.3 percent gain in its stock value.

The company expects to post record revenues and earnings for 2008, Chief Executive Officer Norman Asbjornson said, as customers responded well to new products and price hikes.

Orchid Paper Products Co., a Pryor manufacturer of private label paper towels, bathroom tissue and napkins, posted a miniscule 0.6 percent decline in its share price during the year. In a recession, its "dollar store” clients should supply a steady demand for those necessities.

Lots of laggards

In such a horrible year, even Oklahoma’s blue chips weren’t spared. The market slide, combined with a precipitous fall in energy prices, pushed down many of the state’s energy elite.

Shares of Devon Energy Corp., the state’s largest public company, shed more than one-fourth of their value — which was nearly good enough to land in the top 10. Chesapeake Energy Corp. and Williams Cos. Inc. fell nearly 60 percent. 2007’s hot IPO, SandRidge Energy, plunged 83 percent.

But those weren’t the worst. The biggest losers were slammed by an unforgiving market after suffering other problems.

Tronox Inc., the Oklahoma City chemical company spun off by Kerr-McGee, fell more than 99 percent in 2008. At two cents, the stock is priced for bankruptcy, which the company admits it is considering even as it negotiates with its creditors.

Traders trimmed 95 percent from the stock of Tulsa’s Dollar-Thrifty Automotive Group, which suffered through a major slump in vehicle rentals due to soaring fuel prices, and its affiliation with Chrysler, the shakiest of the Big Three domestic automakers.

Quest Resource Corp., an Oklahoma City energy company, continues to deal with a cash crunch after its previous chief executive officer admitted that he used $10 million in corporate cash for personal reasons. That fallout, and a major slide in energy prices, sent Quest down 94 percent.

Rader, who has nearly five decades of experience as a broker and securities expert, said 2008 was unique in many ways.

"There has never been a market like this in my experience ever,” Rader said.