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The overall market, as measured by the S&P 500 index, showed considerable strength over the shortened week. The index began its ascent on Tuesday morning and continued straight through to the middle of the day on Thursday, when a correction turned the market, and the index, lower. This did not last, however, and by the end of the day, a rally had overtaken the market and propelled it back upward into Friday. Friday opened up with a sharp spike followed by an equally sharp correction and then continued upward through the close of the market. The oil market, meanwhile, was much more volatile. WTI crude bounced around quite aggressively between $95.10 and $96.90, on Wednesday hitting both extremes in the same day. Despite the volatility though, crude oil finished the week at roughly the same level as it began. As usual, this market noise had different effects on each of the seven offshore drilling companies tracked by this weekly series.

Seadrill (NYSE:SDRL) opened on Tuesday, January 22 at $38.41. The stock closed at $39.30 in after hours trading on Friday, January 25. Seadrill shareholders thus saw the value of their holdings increase by $0.89 per share or 2.32% over the past week. Seadrill opened at $36.27 on December 31, 2012. This gives the stock a trailing four-week gain of $3.03 per share or 8.35%.

SDRL 5-Day Chart

(click to enlarge)

Source: Fidelity Investments

SDRL 4-Week Chart

(click to enlarge)

Source: Fidelity Investments

Ensco (NYSE:ESV) opened at $61.57 on Tuesday, January 22. The stock closed at $62.11 in after hours trading on Friday, January 25. Shareholders thus saw the value of their holdings increase by $0.54 per share or 0.88% over the past week. The stock opened at $57.66 on December 31. Stockholders in the company thus saw their holdings increase by of $4.45 per share or 7.72% over the trailing four-week period. On Tuesday, stock ratings site TheStreet.com reiterated its BUY rating on Ensco stock. TheStreet cited Ensco's revenue growth and low debt as reasons for the stock to outperform going forward.

ESV 5-Day Chart

(click to enlarge)

Source: Fidelity Investments

ESV 4-Week Chart

(click to enlarge)

Source: Fidelity Investments

Transocean (NYSE:RIG) opened at $55.84 on Tuesday, January 22. The stock closed at $58.20 in after hours trading on Friday, January 25. Transocean's shareholders thus saw the value of their holdings increase by $2.36 or 4.23% this week. The stock opened at $43.89 on December 31, 2012. This gives Transocean stock a trailing four-week gain of $14.31 or 32.60% over the trailing four-week period. One of the reasons for Transocean's outsized performance this week was news that billionaire activist investor Carl Icahn pushing Transocean to declare a dividend of at least $4 per share. Transocean is currently the only one of the major offshore drilling companies that does not pay a dividend. Mr. Icahn's proposal, if implemented, would give Transocean a yield of 6.87%. This would likely push the stock price upward somewhat and this would also represent the highest yield out of any of the major drillers except for Seadrill.

RIG 5-Day Chart

(click to enlarge)

Source: Fidelity Investments

RIG 4-Week Chart

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Source: Fidelity Investments

Diamond Offshore (NYSE:DO) opened at $72.84 on Tuesday, January 22. The stock closed at $74.55 in after hours trading on Friday, January 25. Shareholders of Diamond Offshore thus saw the value of their holdings increase by $1.71 per share or 2.35% over the week. The stock opened at $67.12 on Monday, December 31. The stock thus had a trailing four-week gain of $7.43 per share or 11.07%.

DO 5-Day Chart

(click to enlarge)

Source: Fidelity Investments

DO 4-Week Chart

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Source: Fidelity Investments

Atwood Oceanics (NYSE:ATW) opened at $50.06 on Tuesday, January 22. The stock closed at $52.99 in after hours trading on Friday, January 25. This gives the stock a gain of $2.93 per share or 5.85% for the week. Atwood opened at $44.29 on December 31, 2012. Thus, shareholders in the company saw the value of their holdings increase by $8.70 per share or 19.64% over the trailing four-week period. On Tuesday, Atwood Oceanics announced that it has received a contract for the Atwood Orca, a newbuild Pacific-class jackup rig. The two year contract promises total contract revenue of $158,900 per day. This adds approximately $116 million in contract backlog for Atwood Oceanics, which improves both the revenue visibility and promises to boost earnings slightly for shareholders once the rig is delivered and begins operating.

ATW 5-Day Chart

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Source: Fidelity Investments

ATW 4-Week Chart

(click to enlarge)

Source: Fidelity Investments

Noble Corp (NYSE:NE) opened the week at $39.87 on January 22, 2013. The stock closed at $37.84 in after hours trading on Friday, January 25. Thus, shareholders saw the value of their holdings decrease by $2.03 per share or 5.09% for the week. Noble opened at $33.95 on December 31, 2012. Thus, the stock had a trailing four week gain of $3.89 or 11.46%. Noble announced fourth quarter earnings that fell short of analysts' expectations this week. I was also disappointed with the company's results, mostly due to the downtime. Regardless, stock ratings site TheStreet.com upgraded Noble to a BUY citing above average revenue and operating cash flow growth.

NE 5-Day Chart

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Source: Fidelity Investments

NE 4-Week Chart

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Source: Fidelity Investments

Pacific Drilling (NYSE:PACD) opened the week at $10.12 on January 22, 2013. The stock closed at $10.33 in after hours trading on Friday, January 25. Thus, shareholders saw the value of their holdings increase by $0.21 per share or 2.08% for the week. Pacific Drilling opened at $9.18 on December 31, 2012. Thus, the stock had a trailing four week gain of $1.15 per share or 12.53%. On Tuesday, Pacific Drilling exercised an option to construct an eighth drillship for its fleet. This rig will allow the company to grow further and more rapidly than it could with only seven rigs.

PACD 5-Day Chart

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Source: Fidelity Investments

PACD 4-Week Chart

(click to enlarge)

Source: Fidelity Investments

All except for one of these stocks saw gains over the trailing five-day period and all seven of them saw gains over the trailing four-week period. The best performer over the past week was Atwood Oceanics, although Transocean deserves an honorable mention here. The worst performer, and the only stock to see a five-day decline, was Noble Corp, which declined following its disappointing earnings report. Transocean was the best performer by far over the trailing four-week period, posting a return of 32.60%. None of the others managed to come close to Transocean's trailing four-week return, although Atwood Oceanics, Pacific Drilling, Diamond Offshore, and Noble Corp all returned double-digit returns over the trailing four-week period. The worst performer over the trailing four-week period was Ensco, but a 7.72% return in four weeks is certainly nothing to be ashamed over. As I have discussed in several articles over the past few weeks, the offshore drilling industry remains strong and is getting stronger. I expect to see the sector continue to deliver gains.

Source: Weekly Performance Update On 7 Offshore Drilling Companies