In this article, we’ll see how analysts upgraded or downgraded offshore drilling (OIH) companies in November and December 2016. It’s important to note that analysts’ estimates usually lag behind price movements—by the time we see upgrades, the stocks have already risen. As for downgrades, they’re apparent when a company has already seen lower prices.
Changes in analysts’ estimates are key drivers of short-term price movements. You should keep track of changes in analysts’ estimates because they offer insights into what the market expects from a given company.
RBC downgraded Atwood Oceanics (ATW) from “sector perform” to “underperform.” It raised the target price from $10 to $15. It also downgraded Rowan Companies (RDC) from “sector perform” to “underperform.” It raised the target price for RDC from $16 to $23.
RBC also downgraded Transocean (RIG) and Diamond Offshore (DO) from “sector perform” to “underperform.” Transocean’s target price was raised from $11 to $17, and Diamond Offshore’s (DO) target price was raised from $19 to $22.
Goldman Sachs downgraded Noble (NE) from “sell” to “neutral.” Noble was downgraded by RBC from “sector perform” to underperform.”
With respect to changes in analyst recommendations in November, Stephens downgraded Atwood Oceanics (ATW) from “overweight” to “equal weight.” Citigroup downgraded ATW from “neutral” to “sell.” Also, Iberia Capital cut ATW from “outperform” to “sector perform.”
Canaccord Genuity raised Transocean from “hold” to “buy.” It also raised the target price from $9 to $11.