As we saw in the previous part of this series, Noble (NE) has a consensus “hold” recommendation based on ratings from 39 analysts covering the stock, according to Bloomberg. Investors may also want to know what the recent market sentiment is toward the stock. If more upgrades than downgrades are happening for the stock, it could mean that a positive market sentiment is emerging. On the other hand, more downgrades could point to a deteriorating market sentiment.
Analyst upgrades and downgrades
Downgrades in offshore drilling (OIH) have been common in this downturn. On February 3, 2016, Fearnley Securities upgraded Noble from “sell” to “reduce,” but cut its price target from $9 to $6. In the same month, SpareBank 1 upgraded the stock from “sell” to “neutral.” On March 11, Goldman Sachs changed its recommendation to “sell/cautious” from “neutral,” and cut its price target from $8 to $5. It further cut its target price to $4.75 in April. Nomura initiated coverage on Noble in April and gave a “reduce” recommendation with a target price of $6.
Barclays reduced the target price to $6 from $7 in March and maintained its “underweight” rating. Barclays also reduced its price target in February. At the end of March, Barclays had downgraded NE’s peers Atwood Oceanics (ATW) and Ensco (ESV) to “underweight” from “equal weight.” It also reduced the price target for Transocean (RIG). To find out more about Barclay’s downgrades, investors can read What Are Estimates for ESV and ATW after Downgrade by Barclays?