Atwood Oceanics Inc
Ensco’s Second-Quarter Cost Guidance
Ensco’s (ESV) drilling expenses were $325 million in the first quarter—up from $278 million in the first quarter of 2017.
Higher Crude Oil Prices Pressure US Natural Gas Futures
US gas rigs are at the highest level since October 20, 2017. Meanwhile, crude oil (USL) (DBO) prices are at a 30-month high.
US Crude Oil Rigs Rose the Most since June 2017
Baker Hughes released its weekly oil and gas rig count report on November 10. It estimated that US oil rig counts rose by nine to 738 on November 3–10.
US Crude Oil Prices Could Pressure Natural Gas Futures
Baker Hughes is scheduled to release its US crude oil and natural gas rig count report on November 11, 2017.
Transocean Gives Capex Guidance for 2017 and 2018
Cash flow Operating cash flow represents cash flow from a company’s core operations. In 3Q17, Transocean’s (RIG) cash flow from operations rose to $384 million from $319 million in the previous quarter. Capital expenditure Transocean’s capex stood at $128 million in 3Q17. The expenditure was mainly related to the company’s contracted newbuild drillships. In 2Q17, its capex was $136 million. In […]
US Crude Oil Rigs Are near a 6-Month Low
On November 3, 2017, Baker Hughes published the US oil rig count report. It estimated that US oil rigs fell by eight to 729 on October 27–November 3, 2017.
Diamond Offshore Drilling Provides 2017 Capex Guidance
For the first nine months of 2017, Diamond Offshore incurred $100 million in capex (capital expenditure), mainly related to rig equipment and replacements.
Ensco’s Fleet Status Report Has Some Good News
Ensco (ESV) released its quarterly fleet status report on October 19, 2017, its first fleet report since it acquired Atwood Oceanics (ATW).
US Crude Oil Rig Count Hit a 2-Week Low
Baker Hughes released its weekly US crude oil rig count report on October 6. The US crude oil rig count fell by two to 748 on September 29–October 6, 2017.
Transocean and Atwood Were Best Performers among Peers Last Week
In the week ending September 29, 2017, almost all of the offshore drilling stocks traded in the green.
US Crude Oil Rig Count Could Be Slower in 4Q17
On September 29, 2017, Baker Hughes (BHI) reported that the US crude oil rig count rose by six to 750 on September 22–29, 2017.
Oil Prices Hit 2-Year High: What It Means to Drilling Industry
The fate of the offshore drilling industry is closely tied to oil prices.
US Natural Gas Rig Count Hit a 9-Week Low
On September 22, 2017, Baker Hughes will release its US natural gas rig count report. The US natural gas rig count fell by one to 186 on September 8–15.
Why the US Crude Oil Rig Count Is near a 3-Month Low
Baker Hughes (BHI) released its weekly US crude oil rig count report on September 15. It reported that the US crude oil rig count fell by seven to 749 between September 8 and September 15.
What Happened in September in the Offshore Drilling Space?
The offshore drilling industry experienced many events in the first half of September 2017. Seadrill (SDRL) filed for Chapter 11 bankruptcy.
Seadrill Stock Rose 20% despite Bankruptcy
Seadrill (SDRL) stock closed at $0.28 on September 13, 2017. The stock rose more than 20% in a single day.
Why the US Crude Oil Rig Count Hit an 11-Week Low
On September 8, energy services company Baker Hughes (BHI) released its weekly US crude oil rig count report.
Why US Crude Oil Rig Counts Fell to a 2-Month Low
Baker Hughes (BHI) released its US crude oil rig count report on August 25, 2017. Baker Hughes reported that the US crude oil rig count fell by four or 0.5% to 759 between August 18 and August 25.
US Natural Gas Rig Count Is Near a 4-Month Low
Baker Hughes released its US natural gas rig count report on August 25, 2017. The US natural gas rig count fell by two to 180 on August 18–25, 2017.
Will the US Crude Oil Rig Count Support Crude Oil Futures?
Baker Hughes released its US crude oil rig count report on August 18, 2017. It reported that the US crude oil rig count fell by five to 763 on August 11–18.
Seadrill Makes an Important Announcement Before Its 2Q17 Results
Seadrill (SDRL) plans to release its 2Q17 results on August 24. In 1Q17, Seadrill’s revenues totaled $569 million, nearly 14.6% lower than its 4Q16 revenues of $667 million.
Atwood Oceanics: New Contracts and Analyst Revisions
Atwood Oceanics has secured a one-well contract extension on its ultra-deepwater rig Atwood Achiever.
Seadrill Partners Resumes Its Dividend Distribution
Seadrill Partners will resume its dividend payments. It declared a quarterly cash dividend of $0.10 per share for the first and second quarter.
Seadrill Partners Stock Rose 17.9% in the Last Trading Session
Seadrill Partners (SDLP) stock closed at $3.15 on August 17, 2017. The stock rose 17.9% in one day, which brought its YTD (year-to-date) return to -25%.
Transocean Secured New Contracts
As of July 25, 2017, Transocean (RIG) had a backlog of $10.2 billion—compared to $10.8 billion in April 2017.
Transocean’s Views on Offshore Drilling Outlook
Transocean’s long-term view of the offshore drilling market, especially for the high-specification floaters, is positive.
Analyzing Transocean’s 2Q17 Earnings
Transocean’s (RIG) revenue exceeded analysts’ revenue estimates by 0.5% in the second quarter. However, it missed the earnings estimate.
Is the US Crude Oil Rig Count Slowing Down?
Baker Hughes released its weekly US crude oil rig count report on August 4, 2017. The US crude oil rig count fell by one to 765 on July 28–August 4, 2017.
US Natural Gas Rig Count: More Concerns for the Bulls?
On August 4, Baker Hughes will release its weekly US natural gas rig count report. The US natural gas rig count rose by six to 192 rigs on July 21–28, 2017.
Is Ensco Still Committed to ATW Acquisition despite Price Drops?
On May 30, 2017, Ensco (ESV) announced its plan to acquire Atwood Oceanics (ATW) in an all-stock transaction.
Why Ensco Expects a Spike in 3Q17 Drilling Costs
Ensco’s (ESV) drilling expenses were $291 million in 2Q17, down from $350 million in 2Q16 but higher than the previous quarter’s $278 million.
Why Moody’s Downgraded Rowan Companies ahead of 2Q17 Results
The consensus 12-month target price for Rowan Companies is $14.59, which implies a potential upside of 25.6% from the market price of $11.6 on July 28, 2017.
Will Diamond Offshore’s Revenue Rise in 2Q17?
Wall Street analysts expect revenue of just over $380 million for Diamond Offshore Drilling in 2Q17. This revenue would represent a 1.6% rise from DO’s revenue of $374 million in 1Q17.
Recent Analyst Changes in Ensco’s Recommendations
Of the 28 analysts covering Ensco, three analysts gave “strong buy” recommendations, while eight analysts gave “buy” recommendations.
Atwood Oceanics: Analysts’ Recent Changes
According to Reuters, 23 analysts give recommendations on Atwood Oceanics. The stock has a consensus rating of three, which indicates a “hold.”
Offshore Drillers: A Key Comparison of Backlogs
Since 2016, all offshore drilling stocks have been hit hard. In this series, we’ll compare the offshore drillers’ backlogs to see which companies could experience the maximum and minimum revenue falls in 2017 and 2018.
Offshore Drillers: Analysts’ Target Prices and Recommendations
Noble’s (NE) target price was cut to $4 from $5. The stock’s closing price that day was $3.89. The revised target price implies a potential upside of 10.8%.
Land Rig Count Rises 510; Offshore Rig Count Rises Just 1
The land rig count is 128.0% or 510 higher than the rig count in the same period last year.
US Crude Oil Rig Count: Turning Point for the Bear Market?
Baker Hughes (BHI) reported that the US crude oil rig count rose by 11 to 758 on June 16–23, 2017. Rigs rose 1.5% week-over-week and 129.8% year-over-year.
How Analysts Reacted to Ensco’s Acquisition
Analysts had mixed reactions to the offshore drilling industry’s first merger since the downturn started.
Analyzing Ensco’s Acquisition of Atwood
Last week Ensco (ESV) announced its decision to acquire Atwood Oceanics (ATW) in an all-equity transaction.
Chart of the Week: Phases of Offshore Drilling Lifecycle
Most offshore drillers released their first quarter earnings in May.
Will President Trump Boost the US Crude Oil Rig Count?
Baker Hughes released its weekly US crude oil rig count report on June 2. US crude oil rig counts rose by 11 to 733 between May 26, 2017, and June 2, 2017.
Will Seadrill Partners’ Dividends Continue in the Future?
In 2Q16, Seadrill Partners cut its quarterly dividends to $0.10 per share—equivalent to an annual distribution of $0.40.
What Were Seadrill Partners Expenses in 1Q17?
Seadrill Partners’ (SDLP) vessel and rig operating expenses fell 10% to $75.8 million in 1Q17—compared to $84.3 million in 4Q16.
Behind Seadrill’s Cost-Cutting Measures
From 4Q16 and 1Q17, Seadrill’s (SDRL) vessel operating expenses fell $23 million to $211 million—a 10% fall.
Where Does Seadrill’s Backlog Stand amid the Current Downturn?
On May 24, 2017, Seadrill (SDRL) had a backlog of $3.4 billion, which is higher than its backlog of $2.5 billion on February 28.
What Are Analysts’ Recommendations for Seadrill?
For Seadrill, two analysts recommended a “buy” and two recommended a “hold.” Five analysts recommended a “sell” and one recommended a “strong sell.”
Analyzing Seadrill’s Stock Crash and Recent Events
Seadrill’s (SDRL) stock price fell more than 84% from the beginning of 2017 to May 18, 2017. The stock fell more than other offshore drillers.
Seadrill’s 1Q17 Results: What Can Investors Expect?
Seadrill will release its 1Q17 results on May 24. In 4Q16, Seadrill’s revenue was $667 million—nearly 10% lower than revenue of $743 million in 3Q16.
Understanding Atwood Oceanics’ Future Revenues Through Backlog
On March 31, 2017, Atwood Oceanics (ATW) had a backlog of $400 million, which was ~60% lower than the $1 billion it reported on March 31, 2016.
Ensco’s Expenses: Dissecting the Cost Side
Ensco’s (ESV) drilling expenses fell to $278 million in 1Q17, down from $289 million in 4Q16 and $364 million in 1Q16.
Understanding Ensco’s Capital Expenditure Plans
In the first three months of 2017, Ensco saw cash flows from operations of $104 million, as compared to $233 million in 1Q16.
US Crude Oil Rig Count Hit a 2-Year High
Baker Hughes (BHI) released its weekly US crude oil rig count on April 28, 2017. It reported that crude oil rigs rose by nine to 697 on April 21–28, 2017.
Transocean Falls 22% YTD—What Analysts Have to Say
Of these 36 analysts, one analyst gave Transocean (RIG) a “strong buy,” six analysts gave a “buy” recommendation, and 15 analysts recommended a “hold.”
Ensco: Why 3 Analysts Revised Their Recommendations
Of the 35 analysts covering Ensco (ESV), three analysts gave “strong buy” recommendations, while eight analysts gave “buy” recommendations.
US Natural Gas Rig Count Hit December 2015 High
Baker Hughes (BHI) will release its weekly US natural gas rig count report on April 21, 2017. The rig count fell by three to 162 rigs on April 7–14, 2017.
US Natural Gas Rig Count at Its Highest since December 2015
From March 24–31, 2017, the natural gas rig count rose by five to 160 rigs. It was its highest level since December 31, 2015.
A Look at Offshore Drillers’ Valuation Multiples
Offshore drilling (IYE) (OIH) companies are cyclical and volatile in nature. They’re also capital-intensive, with high levels of depreciation and amortization, and their financial leverages vary.
Seadrill Has the Most ‘Sell’ Ratings among Its Peers
In this part of the series, we’ll compare Wall Street analysts’ consensus ratings for the offshore drilling companies we’ve been analyzing.
US Crude Oil Rig Count Hit September 2015 High: What’s Next?
Baker Hughes reported that the US crude oil rig count rose by 21 to 652 rigs from March 17–24. The oil rig count has risen 35 times in the last 38 weeks.
Where Transocean Stock Stands Next to Peers
After the news of the sale of Transocean’s (RIG) jack-up fleet broke on March 20, RIG stock closed at $12.22—2% lower than the previous day’s closing price.
US Crude Oil Rig Count Hit an 18-Month High
Baker Hughes reported that the US crude oil rig count rose by 14 to 631 rigs from March 10–17. The rig count has risen 34 times in the last 37 weeks.
US Crude Oil Rig Count Hit September 2015 High
The US crude oil rig count rose by eight to 617 rigs from March 3–10, 2017. The US crude oil rig count has risen 33 times in the last 36 weeks.
Seadrill’s Outlook on Offshore Drilling
Conference call insights In this article, we’ll examine Seadrill’s (SDRL) 4Q16 conference call insights on current developments in the offshore drilling (OIH) space. In the call, the company expanded on its view of the industry’s future. Studying these developments can help us gauge the future of Seadrill, its parent company, Seadrill Limited (SDRL), and peers Diamond Offshore Drilling (DO), […]
Details about the Rowan-Saudi Aramco Joint Venture
Rowan Companies and Saudi Aramco entered into a 50-50 joint venture. The joint venture will own, operate, and manage offshore drilling rigs in Saudi Arabia.
Rowan Companies’ Take on the Offshore Drilling Industry
Rowan Companies shared its outlook for the offshore drilling market. Its view could also shed some light on the outlook for its offshore peers.
How Have Ocean Rig’s Ratings Changed over the Past Year?
Analysts have a 12-month price target of $0.78 for Ocean Rig (ORIG), compared to the current price of $0.78 on February 24, 2017. It implies a potential downside of 0.1%.
Transocean’s Backlog Offers a Picture of 2017 and 2018 Revenues
As of February, 2017, Transocean (RIG) had a backlog of $11.3 billion compared with $12.2 billion at the end of 3Q16.
Transocean’s Take on Offshore Drilling’s Outlook
In its 4Q16 conference call, Transocean (RIG) shared its outlook for the offshore drilling market.
A Look at Transocean’s Recent Contracts
Fleet status report Transocean (RIG) released its quarterly fleet status update on February 9, 2017. Transocean’s backlog was $11.3 billion, compared with $12.2 billion in its October fleet status report. In this article, we’ll take a look at contract updates between these two report dates. Contract updates On December 31, 2016, Transocean’s newbuild ultra-deepwater drillship, […]
How Noble Earned Higher 4Q16 Revenue despite the Downturn
Noble Corporation’s (NE) contract drilling revenue was $401 million in 4Q16. This total included a $16 million contract termination lump sum settlement.
Analysts’ Take on Noble Energy’s 4Q16 Results
Noble Energy (NE) is scheduled to release its 4Q16 results after the market closes on February 9, 2017. A conference call will follow on February 10, 2017.
Onshore Rig Count Rose: What about Offshore?
For the week ending January 20, 2017, the US offshore rig count fell by one from the previous week to 24, while land-based rigs rose by 36 units to 670.
Analysts Expect 2 Straight Quarters of Rising Revenue for DO
Wall Street analysts expect revenue of just over $358 million for Diamond Offshore Drilling (DO) in 4Q16. This revenue would represent a rise from DO’s 3Q16 revenue
A Look at the Financial Health of Offshore Drillers
Offshore drilling (IYE) companies are capital-intensive, so it’s important to look at their financial leverages.
Offshore Drillers: How Their Backlogs Are Rapidly Declining
The offshore drilling industry has had low day rates and few or no new drilling contracts in the past year. Companies are alive mostly due to their earlier contracts.
Changes in Analyst Recommendations for Offshore Drillers
In December, RBC downgraded Atwood Oceanics (ATW) from “sector perform” to “underperform.” It raised the target price from $10 to $15.
How Did Offshore Drilling Perform in December?
Offshore driller stocks have risen significantly in December 2016. In this series, we’ll see how oil prices rose after the OPEC deal and how this increase could affect the offshore drilling industry.
Seadrill Gets Contract Extension with Saudi Aramco
On December 29, 2016, Seadrill (SDRL) announced that it has secured a three-year contract extension from Saudi Aramco for its jackup AOD III.
How Crude and Natural Gas Rig Counts Affected Natural Gas Prices
The US natural gas rig count rose by two to 118 rigs between November 18 and November 23, 2016.
Seadrill’s Efforts Should Push Its Debt Repayment to 1Q17
In 3Q16, Seadrill (SDRL) had cash flow from operations of $242 million, 20% lower than the previous quarter’s $303 million.
Is Atwood Oceanics’ Backlog Cause for Worry?
Contract backlog On September 30, 2016, Atwood Oceanics (ATW) had a backlog of $0.8 billion, ~50% less than the $1.6 billion reported a year ago. Knowing a drilling company’s backlog helps us to gauge its maximum revenue based on its current contracts. Backlog for 2017–18 The backlog for fiscal 2017 stands at $431 million, which […]
Atwood Oceanics: A Deep Fall in Revenue Awaits in Next Quarter
Atwood Oceanics earns revenue by operating floating rigs and jack-up rigs. Its fiscal 4Q16 revenue was $189 million, a fall of almost 17% from the $228 million reported in 3Q16.
Have Analysts Changed Their Recommendations for PACD after 3Q16?
After Pacific Drilling released its 3Q16 earnings, no Wall Street analysts either upgraded or downgraded its stock, unlike Diamond Offshore and Rowan Companies.
Is Pacific Maintaining Its Margins in a Falling Revenue Scenario?
Pacific Drilling’s (PACD) operating expense-to-revenue ratio stood at 37.5% at the end of 3Q16, similar to the previous quarter’s 37.3% and 3Q15’s 37.7%.
Rowan’s 3Q16 Revenue and EBITDA Exceeded Analyst Estimates
Rowan’s adjusted revenue fell to $379 million in 3Q16 from $485 million in 2Q16.
Analyst Recommendations for Ensco after Its 3Q16 Results
Of the 36 analysts covering Ensco (ESV), 14% have given it a “buy” recommendation, 58% have given it a “hold” recommendation, and 28% have given it a “sell” recommendation.
Will Diamond Offshore’s Revenue Fall Halt in 3Q16?
Analysts estimate revenues of ~$362 million for Diamond Offshore in 3Q16, as compared to revenues of $388 million in 2Q16 and $634 million in 3Q15.
As Noble Takes Delivery of Newbuild, What About Free Cash Flow?
Noble’s capex requirement for 3Q16 is high with the delivery of its newbuild. So analysts expect free cash flow to be -$376 million in 3Q16.
Offshore Drillers Dealing with Oil Prices above $50
Since the start of October, oil prices have remained above $50 per barrel. In this series, we’ll analyze indicators that you can track to get a sense of the offshore industry’s direction.
Analysts Upgrades, Downgrades, and Other Changes for Offshore Drilling
Of the 34 analysts covering Diamond Offshore, two analysts gave it a “buy” recommendation, 18 analysts gave it a “hold,” and 14 analysts gave it a “sell.”
Ensco: A Deep Fall in Earnings Seems to Be Inevitable
Ensco’s backlog In 2Q16, Ensco’s (ESV) blend-and-extend agreements with its customers helped add some revenue backlog for the company. However, these additions aren’t sufficient to recoup the utilized backlog in the second quarter. On June 30, 2016, Ensco (ESV) had a total backlog of $4.1 billion compared to $5.2 billion at the end of 1Q16. Ensco’s backlog-to-trailing-12-month-revenue ratio […]
Atwood Oceanics, Noble Suffered the Most in This Area in 2Q16
The offshore drilling industry works on contracts that range from a few months to years. The contracts specify the timeframe and day rate awarded to a rig.
Transocean Has Highest Backlog of Its Peers
In an industry downturn, especially like the one offshore drillers are experiencing right now, it’s crucial to have a high backlog.
EVA Dimensions Upgrades Diamond Offshore
Recent updates EVA Dimensions upgraded Diamond Offshore (DO) to “overweight” from “hold” on September 13, 2016. Scotia Howard initiated coverage on Diamond Offshore on September 14. It gave a “sector perform” rating and a target price of $17. Scotia Howard also initiated coverage on offshore drillers (OIH) Rowan (RDC), Atwood Oceanics (ATW), Transocean (RIG), and […]
Recent Auction in Gulf of Mexico: Hope or Disappointment?
The offshore oil and gas lease rights auction for the Gulf of Mexico wasn’t successful. Low interest in the sale highlighted the poor condition of offshore drilling.
Bad News Continuesd for Offshore Drillers in August
August didn’t bring any good news for the offshore drilling industry. All stocks had negative returns, and no company predicted a turnaround, at least in the near term.
Behind the Improving Cost Side of Ocean Rig
Ocean Rig (ORIG) recorded general and administrative expenses of $26.9 million in 2Q16, as compared to $19 million in 1Q16.
How Transocean Was Able to Reduce Costs
In spite of a fall in revenue, Transocean’s drilling-to-revenue ratio fell to 54% in the second quarter from 60% in the first quarter.