Rig operating companies have witnessed a challenging year on relatively difficult market conditions. Seadrill (NYSE:SDRL) stock is down 6.5% for 2014, Ensco (NYSE:ESV) is down 12.8% for the year, Transocean (NYSE:RIG) is down 19% and Ocean Rig is down 3.7% for the year.
What I believe is that the downside in offshore drilling companies is temporary and the long-term fundamentals are strong. In the last few years, some of the biggest oil discoveries have been offshore and this trend is likely to continue.
Further to this, oil prices will remain firm as geo-political tensions around the world are high. This will support drilling activity as break-even is achieved for oil & gas...
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