Despite COP's Improving Story, Morgan Stanley Prefers CVX

ConocoPhillips' COP analyst meeting was the third and final of the 2011 US large-cap, Integrated analyst meetings, Morgan Stanley reports. “In our view, the entire group of large cap oils remains attractively valued versus the S&P 500 with moderate production growth, peer-leading commodity exposure to rising crude prices, high free cash flow yields and defensive balance sheets,” Morgan Stanley writes. “While we think COP's story continues to improve, we prefer Chevron Corp. CVX amongst the large caps, where production growth, oil leverage and returns exceed those at COP, while still trading at a 20% discount.” ConocoPhillips closed Wednesday at $78.54; Chevron closed at $105.48.