Diamond Offshore Drilling Inc.NYSE
Wed, Nov. 30, 2:30 PM
- Oil and gas names continue to surge following the news that OPEC will cut production.
- Among the 36 energy stocks in the benchmark SPDR Energy ETF, 13 are up by at least 10%: MRO +21.6%, RIG +19.6%, MUR +15.7%, DVN +15.2%, NFX +15.2%, HES +14.8%, APC +13.6%, HAL +13.6%, CXO +11.3%, XEC +10.9%, EOG +10.5%, COP +10.4%, CHK +10%.
- Continental Resources (CLR +23.6%) soars to a 52-week high, making founder and CEO Harold Hamm, already the wealthiest U.S. energy billionaire, another $3B richer.
- Offshore drillers are broadly sporting double-digit gains: ESV +24.8%, ATW +20.6%, RIGP +18.7%, SDRL +16.5%, DO +15.7%, RDC +15%.
- "For all E&P stocks, this is a bullish call for sure, because price is directly correlated with cash flow," says Luana Siegfried, energy equity research associate at Raymond James, which sees U.S. crude reaching $60/bbl by year-end.
- MarketWatch's Philip van Doorn writes that pending earnings estimate increases from analysts ought to set a floor under the energy sector and support even higher prices for oil stocks.
Wed, Nov. 30, 9:23 AM
- Gainers: SCON +71%. CRC +32%. ORIG +16%. DNR +16%. GST +16%. OAS +17%. LEI +16%. WTI +14%. SM +13%. AREX +13%. SN +13%. CPE +13%. SDRL +13%. CIE +13%. HHS +13%. SGY +13%. LPI +12%. SYRG +12%. WLL +11%. ATW +11%. GTE +11%. CLR +11%. WPX +11%. ESV +11%. NE +10%. CRZO +10%. DO +10%. NBR +10%. BTE +10%. MRO +10%.
- Losers: ARWR -61%. CERC -47%. CMRE -14%. AEO -10%. GLBS -9%.
Tue, Nov. 1, 7:57 PM
- Diamond Offshore Drilling (NYSE:DO) is downgraded to BB+ from BBB with a negative outlook at Standard & Poor's, reflecting a revised assessment of the company’s business risk profile and assumptions for utilization of its uncontracted fleet in light of continued weak market conditions.
- DO has 14 of its 28-vessel fleet cold-stacked, and believes companies with cold-stacked rigs will find it increasingly difficult to recontract them even when the market recovers, since it expects customers to favor working, warm-stacked or newbuild rigs.
- S&P's move follows DO's Q3 results yesterday which beat expectations for earnings but fell short on revenues.
Mon, Oct. 31, 6:02 AM
Sun, Oct. 30, 5:30 PM
Tue, Oct. 11, 7:55 AM
- BP says it is abandoning plans to drill deepwater oil exploration wells off in the Great Australian Bight, deciding that the project would not be able to compete for capital investment against other upstream opportunities.
- BP says the decision to drop the project off Australia's southern coast in an environmentally sensitive area was not influenced by regulatory delays, but it had faced strong opposition from environmental groups that warned of potential spills on the scale of the 2010 Deepwater Horizon disaster.
- BP says it made the move following discussions with Statoil (NYSE:STO), its joint venture partner in the region.
- BP is now looking for other work for the Ocean GreatWhite semi-submersible drilling rig that was contracted from Diamond Offshore (NYSE:DO) in 2013; BP says the decision to quit the Great Australian Bight project does not impact the rig contract.
Tue, Sep. 27, 5:28 PM
- Coty (COTY +0.3%) is heading to the S&P 500, replacing Diamond Offshore Drilling (DO -0.4%) in that index. Diamond Offshore is off 1.3% after hours, while COTY is up 0.4%.
- Diamond Offshore will move to the S&P MidCap 400, replacing Polycom (NASDAQ:PLCM), which has been acquired by Siris Capital Group. The contract driller was ranked at the bottom of the 500 and now has a market cap more reflective of a mid-cap, S&P Dow Jones Indices says.
- The moves are effective after the close on Friday.
- Meanwhile, Tile Shop Holdings (TTS -0.3%) is replacing Epiq Systems (NASDAQ:EPIQ) in the SmallCap 600, as Omers Private Equity is acquiring Epiq in a deal expected to be completed soon.
Wed, Sep. 21, 3:43 PM
- Diamond Offshore (DO +3.6%) is downgraded to Sell from Neutral with a $10 price target, while Noble Corp. (NE +5.3%) is upgraded to Neutral from Sell with a $4 target, at Goldman Sachs, which foresees weakness in the offshore rig market likely persisting through 2020.
- Goldman says DO is significantly over-earning vs. the spot market, and with key above-market contracts set to expire through 2020, the company’s EBITDA likely will decline by 40% annually vs. 10% for NE, which already has suffered a sharp EBITDA correction.
- The firm expects demand for jack-up rigs to recover before demand for floaters, and DO has the least jack-up exposure within the peer group while NE enjoys significantly higher exposure to jack-ups.
- Evercore ISI recently upgraded DO to Buy amid signs of hope for the offshore rig market.
Tue, Sep. 20, 3:45 PM
- Diamond Offshore (DO +2.4%) is upgraded to Buy from Hold at Evercore ISI, which believes the unwinding of shorts as oil prices firm and an offshore rig market bottom materializes over the next 6-12 months could be a catalyst for offshore drillers.
- The firm notes the recent news that the Rowan Reliance drilling contract may be terminated early - the news was expected but was surprised that the company said an exclusive five-year service agreement could be in lieu of a contract termination; it sees the modified blend-and-extend agreement suggests the operator could see a potential offshore rig market bottoming by March 31 and tightening within the next 12 months.
- Evercore continues to rate Ensco (ESV -1.4%), Rowan ([[RDC] -0.5%) and Noble Corp. (NE -2%) as Buys, "as this select group of offshore drillers will be survivors of the current multi-year cyclical downturn."
Thu, Sep. 1, 2:19 PM
Thu, Aug. 25, 12:27 PM
- Transocean (RIG +1.4%) is upgraded to Neutral from Sell with an $11 price target at Citigroup, which says RIG has exceeded expectations for cost reductions while the backlog remains superior to peers.
- Citi says that while RIG's EBITDA should steadily decline, the company does not face an EBITDA cliff unlike some peers, and the company also was able to issue debt which has lowered bond yields.
- Among offshore drillers, Citi rates Ensco (ESV +0.1%), Diamond Offshore Drilling (DO +0.1%), Noble Corp. (NE -0.6%), Atwood Oceanics (ATW -1.4%), Rowan (RDC -0.6%) and RIG at Neutral, while Pacific Drilling (PACD -2.7%) remains rated a Sell.
Fri, Aug. 12, 5:30 PM
- It's still too early to get involved in offshore drillers, RBC analysts say as they expect the group to continue to underperform through 2017 with the supply overhang requiring years to balance out.
- The firm says drillers will need to continue the current pace of rig retirements and retire an additional ~110 rigs by 2020 to balance the market, another 70 retirements are still needed to balance the floater market, and the jackup market will need ~40 additional retirements over the next four years to reach mid-cycle equilibrium by 2020.
- RBC cuts its price targets for Transocean (NYSE:RIG) to $11 from $14, Diamond Offshore (NYSE:DO) to $23 to $29, Atwood Oceanics (NYSE:ATW) to $11 from $14, Rowan (NYSE:RDC) to $16 from $22, and Noble Corp. (NYSE:NE) to $8 from $11.
Mon, Aug. 1, 6:01 AM
Sun, Jul. 31, 5:30 PM
Wed, Jul. 27, 5:57 PM
- Offshore drilling stocks were slammed today as crude oil prices fell to three month lows, but Atwood Oceanics (NYSE:ATW) took the worst beating, -8.6% following its latest fleet status update.
- The contract for the Atwood Osprey rig, which had been expected to start working for Woodside Energy until January 2017 at a $450K dayrate, was extended but at a new rate of $190K; also, no contracts were announced for two uncontracted, newbuild drillships despite talk of a potential Brazil agreement in the works.
- Also in today's trade: RIG -4.1%, DO -3.1%, RDC -4.6%, ESV -4.7%, SDRL -0.6%, NE -3%.
Fri, Jul. 22, 2:23 PM
- Transocean (RIG -5.5%) falls more than 5% after its latest fleet status report showed it stacked an additional six rigs, taking its total number of currently stacked rigs to 28, with reduced dayrates for others.
- RIG says it won a two-year contract for one of its semi-submersibles to operate off India for ONGC at a $127K dayrate, and a newbuild ultra-deepwater rig started operations on a 10-year contract in the Gulf of Mexico at a $498K dayrate.
- Following the report, RBC's Kurt Hallead says RIG shares have limited upside until the market gains more confidence in the supply and demand outlook for floating rigs in 2017-18. Currently, fundamentals continue to weaken for floating rigs, and it remains unclear where dayrates and utilization may bottom.
- Offshore drillers are broadly lower: RIGP -1%, DO -1.5%, ESV -4.2%, RDC -5%, SDRL -1.6%, NE -4.8%, ATW -3.6%, PACD -3.8%.