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Why Analysts Are More Optimistic about Offshore Drilling Stocks

PART:
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Part 2
Why Analysts Are More Optimistic about Offshore Drilling Stocks PART 2 OF 3

Why UBS Upgraded Several Offshore Drilling Companies

Upgrades

UBS upgraded the following offshore drillers on September 25, 2017:

Why UBS Upgraded Several Offshore Drilling Companies

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UBS estimates

According to UBS analyst Angie Sedita, the offshore drilling industry is set to recover in the coming years. The jack-up and utilization rates had dropped to 50% and 60%, respectively, but UBS expects that these will rise up to 75% and 79%, respectively, by 2020.

UBS also stated that it expects offshore drilling companies’ EBITDA (earnings before interest, taxes, depreciation, and amortization) to rise 25% by 2020.

Transocean

UBS raised its target price for Transocean (RIG) to $15 from $9.35. 28% of the analysts covering Transocean are bullish, 46% of the analysts are neutral, and the remaining 26% of the analysts are bearish on Transocean.

Diamond Offshore

UBS upgraded Diamond Offshore (DO) to “buy” from “neutral.” It also raised the target price for DO to $15 from $12. Thirty-one analysts give recommendations on Diamond Offshore. Out of these, 13% of the analysts are bullish, 58% of the analysts are neutral, and 29% of the analysts are bearish on DO.

Noble

UBS upgraded Noble (NE) to “buy” from “neutral.” It also raised the target price to $6 from $4. Thirty-four analysts give recommendations on NE. Out of these, 30% of the analysts are bullish, 44% of the analysts are neutral, and 26% of the analysts are bearish.

Ensco

UBS upgraded Ensco (ESV) to “buy” from “neutral.” It also raised the target price to $8 from $6. Twenty-nine analysts give recommendations on Ensco. Out of these, 45% of the analysts are bullish, 34% of analysts are neutral, and 21% of the analysts are bearish on Ensco.

Rowan Companies

UBS also upgraded Rowan Companies (RDC) to “buy.” It raised the target price to $15 from $11. In the next article, we’ll look Jefferies’ target price revisions last week.

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