Diamond Offshore Drilling’s earnings

In fiscal 4Q15, analysts expect and adjusted net EPS (earnings per share) of $0.51 for Diamond Offshore Drilling (DO). This means Wall Street analysts expect Diamond Offshore Drilling’s fiscal 4Q15 earnings to fall nearly in half from the adjusted EPS of $1.02 in fiscal 3Q15. A lower average margin per rig and project cancellations by upstream companies can lower Diamond Offshore Drilling’s fiscal 4Q15 earnings. Diamond Offshore Drilling is expected to release its fiscal 4Q15 earnings press release on February 8, 2016.

Diamond Offshore Drilling’s adjusted earnings fell from fiscal 2Q13 through fiscal 1Q15. During this period, its adjusted EPS fell by 62%. From fiscal 1Q15 until fiscal 3Q15, Diamond Offshore Drilling’s adjusted EPS more than doubled. Despite the falling rig count, its rig efficiency improvement and cost reduction boosted the bottom line.

What Do Analysts Expect from Diamond Offshore’s 4Q15 Earnings?

Diamond Offshore Drilling’s earnings versus estimates

In fiscal 3Q15, Diamond Offshore Drilling’s adjusted EPS exceeded analysts’ consensus EPS by 69%. As noted in the above graph, Diamond Offshore Drilling’s adjusted EPS exceeded estimates in many quarters in the past. On average, the adjusted EPS exceeded the consensus EPS by ~18% in the past 11 quarters.

Superior Energy Services (SPN) is Diamond Offshore Drilling’s peer in the oilfield services and equipment provider industry. In fiscal 3Q15, it reported a net loss of $821 million compared to Diamond Offshore Drilling’s net income of $136 million in fiscal 3Q15. Diamond Offshore Drilling accounts for 1.7% of the VanEck Vectors Oil Services ETF (OIH).

Next, we’ll discuss Diamond Offshore Drilling’s value drivers.

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