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Top Analyst Upgrades & Downgrades (AIG, DELL, FWLT, HOG, KBR, MDR, NE, PLG, GOLD, RJF, SKS, TIVO, VLO, VE, WPRT)

Administrator — Tue, 10 Apr 2012 12:17:23 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Tuesday.

American International Group Inc. (NYSE: AIG) Raised to Outperform at Wells Fargo.

Dell Inc. (NASDAQ: DELL) Raised to Equal-weight at Morgan Stanley.

Foster Wheeler AG (NASDAQ: FWLT) Started as Overweight at JPMorgan.

Harley-Davidson, Inc. (NYSE: HOG) Raised to Buy at Citigroup.

KBR Inc. (NYSE: KBR) Started as Overweight at JPMorgan.

McDermott International Inc. (NYSE: MDR) Started as Overweight at JPMorgan.

Noble Corp. (NYSE: NE) Reiterated Buy with $50 target at Argus.

Platinum Group Metals Ltd. (NYSE: PLG) Cut to Neutral at Credit Suisse.

Randgold Resources Ltd. (NASDAQ: GOLD) target raised at Goldman Sachs.

Raymond James Financial Inc. (NYSE: RJF) Started as Outperform at Wells Fargo.

Saks Inc. (NYSE: SKS) Reiterated Buy with $14 target at Argus.

TiVo Inc. (NASDAQ: TIVO) Started as Neutral at JPMorgan.

Valero Energy Corporation (NYSE: VLO) Raised to Top Pick at Citigroup.

Veolia Environnement S.A. (NYSE: VE) Raised to Buy at Nomura.

Westport Innovations Inc. (NASDAQ: WPRT) Started as Overweight at Piper Jaffray.

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JON C. OGG

Filed under: Analyst Calls Tagged: AIG, DELL, FWLT, gold, HOG, KBR, MDR, NE, PLG, RJF, SKS, TIVO, VE, VLO, WPRT

Top Analyst Upgrades & Downgrades (ANF, AES, ALU, BUD, BHI, DD, EL, MNKD, MU, MWW, NE, NVDA, SHLD, TSCO, X, V)

Administrator — Mon, 13 Feb 2012 13:17:32 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street brokerage and research firms this Monday morning.

Abercrombie & Fitch Company (NYSE: ANF) Reiterated Buy with $70 target at Jefferies.
AES Corporation (NYSE: AES) Started as Buy at UBS.
Alcatel-Lucent S.A. (NYSE: ALU) Cut to Sell at Soc-Gen.
Anheuser-Busch InBev (NYSE: BUD) Started as Neutral at Credit Suisse.
Baker Hughes Inc. (NYSE: BHI) Cut to Neutral at Goldman Sachs.
E.I. du Pont de Nemours and Company (NYSE: DD) Started as Equal-weight at Morgan Stanley.
Estee Lauder Companies, Inc. (NYSE: EL) Cut to Neutral at Citigroup.
MannKind Corporation (NASDAQ: MNKD) Started as Overweight at Piper Jaffray.
Micron Technologies Inc. (NASDAQ: MU) Reiterated Outperform with $12.00 target at Credit Suisse.
Monster Worldwide, Inc. (NYSE: MWW) Cut to Sell at Citigroup.
Noble Corporation (NYSE: NE) Raised to Buy at Goldman Sachs.
NVIDIA Corporation (NASDAQ: NVDA) Raised to Outperform at FBR.
Sears Holding Corporation (NASDAQ: SHLD) Maintained Underperform as Bear of the Day at Zacks.
Tractor Supply Co. (NASDAQ: TSCO) Maintained Outperform as Bull of the Day at Zacks.
U.S. Steel Corporation (NYSE: X) Cut to Hold at KeyBanc.
Visa Inc. (NYSE: V) Reiterated Buy and raised target to $130 at Argus.

If you enjoyed the top analyst upgrades and downgrades, you can sign up in the box below to join our morning email list to receive news directly in your inbox each morning. We include major analyst upgrades and downgrades, IPO and M&A news, special situation developments, observations on Warren Buffett and key market gurus, as well as special exclusive feature stories.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Analyst Calls Tagged: AES, ALU, ANF, BHI, BUD, DD, EL, MNKD, MU, MWW, NE, NVDA, SHLD, TSCO, V, X

Crude Demand Falls, Profits to Follow? (XOM, CVX, COP, BP, VLO, TSO, WNR, SLB, HAL, NE, APA, DVN, CHK)

Administrator — Wed, 10 Aug 2011 13:42:28 +0000

High prices have finally contributed to curing high prices in the world’s crude oil market. The gloomy economic forecasts for the second half of 2011 have combined with $120/barrel prices for Brent crude to send the price below $100/barrel and to push WTI prices momentarily below $80/barrel.

The International Energy Agency and OPEC agree that forecast demand growth in 2011 is 1.2 million barrels/day. The US Energy Information Administration has pegged demand growth in 2011 at 1.4 million barrels/day. The difference is that the EIA estimates US GDP growth of 2.4% in 2011, whereas OPEC believes US GDP will grow by a scant 1.8%. The IEA GDP growth estimate for North America is 2.7%.

The lowered demand estimates should moderate pump prices in the US and the rest of the world, but will certainly hit profits at major oil producers like Exxon Mobil Corp. (NYSE: XOM), Chevron Corp. (NYSE: CVX), ConocoPhillips Corp. (NYSE: COP), and BP plc (NYSE: BP). The largest contributor to big profits at these companies has been high prices for crude and for gasoline. They will still earn profits at $80-$85/barrel, just not as much. A drop to $75/barrel would be closer to the bone, and anything below that for an extended period of time could spell trouble.

The integrated oil companies’ refining operations will make up some of the difference, as their input costs will fall with the price of crude. Pure downstream outfits like Valero Energy Corp. (NYSE: VLO), Tesoro Corp. (NYSE: TSO), and Western Refining Inc. (NYSE: WNR) should also see a rise in profits, but the increase will be more modest, especially if the near $20/barrel differential between WTI and Brent closes.

As for service companies and drillers like Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL), Noble Corp. (NYSE: NE), and others, their prospects are still solid, due in large part to development of shale oil and gas. An oil and gas industry group projects that up to 200,000 new jobs will be created in the oil & gas patch in 2011.

For several years now the industry has been concerned about a burst of petroleum engineers reaching retirement age with no replacements available. The situation has grown even tighter now, as companies like Apache Corp. (NYSE: APA), Devon Energy Corp. (NYSE: DVN), and Chesapeake Energy Corp. (NYSE: CHK) continue to troll for new engineering talent.

Both the IEA and the EIA are looking at the world’s economy through glasses that if not rose-colored are surely tinted by government projections and policy. OPEC’s US GDP growth estimate of 1.8% seems clearly more in-line with recent economic performance.

And cuts to federal and state budgets will soon put more Americans out of work. Anyone who expects reduced spending to put some life back into the US economy has simply not been paying attention or has some other ax to grind.

The main prop to crude prices is demand from China, which is expected to grow to at least 6.5 million barrels/day in 2011. Demand from developed countries is essentially flat to down. The shortfall due to the loss of Libyan oil has been made up, mostly by increased production from OPEC.

The main driver of crude prices is the same as it has always been: growing demand for an ever-shrinking supply. Speculation is not the culprit, nor is OPEC. Weak economic growth slows demand and forces prices down. The impact on the oil & gas industry will be noticeable, but not devastating.

Paul Ausick

Filed under: Commodities, Oil & Gas Tagged: APA, BP, CHK, COP, CVX, DVN, HAL, NE, SLB, TSO, VLO, WNR, XOM

S&P Rates Oil & Gas Stocks Stable (XOM, CVX, COP, APA, CHK, SLB, HAL, BHI, NE, RIG, DO, VLO, TSO, MPC)

Administrator — Mon, 08 Aug 2011 16:32:22 +0000

As the markets swoon today from Friday night’s downgrade of US debt, Standard & Poor’s is making other changes to its debt ratings. One sector that is unchanged is oil and gas, about which S&P says that it believes “robust oil prices are sustainable throughout the remainder of the year and into 2012, which benefit any producer focused on oil and natural gas liquids.”

The S&P ratings note affects integrated oil and gas biggies like Exxon Mobil Corp. (NYSE: XOM), Chevron Corp. (NYSE: CVX), and ConocoPhillips Corp. (NYSE: COP) as well as E&P companies like Apache Corp. (NYSE: APA) and Chesapeake Energy Corp. (NYSE: CHK). Field services firms and drilling contractors are also rated stable. These are firms like Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL), and Baker Hughes Inc. (NYSE: BHI), Noble Corp. (NYSE: NE), Transocean Ltd. (NYSE: RIG), and Diamond Offshore Drilling Inc. (NYSE: DO). S&P is upbeat on refiners as well, which means Valero Energy Corp. (NYSE: VLO), Tesoro Corp. (NYSE: TSO), and Marathon Petroleum Corp. (NYSE: MPC) ought to prosper.

Unfortunately, the market has fallen about -2.5% so far this morning, and all these oil and gas companies are getting an even worse beating. That is due to the price of oil falling below $84/barrel on the belief that the global economy is still weak and will get weaker before it improves.

S&P puts its forecast for WTI crude in 2011 at $97.67/barrel and for 2012 at $103.59/barrel. Those prices would indeed be good news for the oil & gas sector. S&P notes that consumers have not cut back significantly on driving either, further propping up demand for oil.

Demand for oil could also boost prices for natural gas according to S&P, although the firm warns that over-supply will set the course for natural gas prices.

It’s difficult to know what to make of S&P’s note. If oil prices remain high, then the companies will make profits. But oil prices will suffer if the US — and the global — economy doesn’t improve faster than it is at present.

To some degree this is a perception issue. High US unemployment lowers the amount of gasoline commuters require and also lowers the amount of gasoline US consumers need for vacation or discretionary driving. And even though the US no longer drives the global demand for oil, cuts in US demand punch way above their weight among oil traders. Some of that has to do with oil being priced in dollars.

As the economy weakens, the dollar weakens and that should drive up the price of oil. Dollar weakness becomes, in effect, a hedge against falling demand for oil. To that extent, S&P is probably correct to anticipate higher prices for oil.

And while it’s always dangerous to talk about US consumer sentiment, the S&P downgrade “reflects our view that the effectiveness, stability, and predictability of American policy-making and political institutions have weakened at a time of ongoing fiscal and economic challenges.” If the downgrade of US debt can be based on taking a political temperature reading, then gauging US consumer sentiment can figure significantly into forecasting oil prices.

Exxon Mobil shares are down about -3%, roughly equal to the DJIA decline, while Chevron and Conoco are both down between -4.5% and -5%. Chesapeake is off around -6%, at $28.76, in a 52-week range of $19.68-$35.95. Services firms are down anywhere from -4.5% to nearly -7%, as are drillers. Refiners are taking the most punishment, with Tesoro down more than -9% to $19.48, in a 52-week range of $10.77-$28.74.

Paul Ausick

Filed under: Analyst Calls, Commodities, Oil & Gas, Research Tagged: APA, BHI, CHK, COP, CVX, DO, HAL, MPC, NE, RIG, SLB, TSO, VLO, XOM

Stunning: Petrobras Spending $224.7 Billion on Offshore Oil (PBR, NE, DO, RIG, HAL, BHI, SLB)

247wallst — Sat, 23 Jul 2011 13:30:30 +0000

Brazil’s Petroleo Brasileiro SA (NYSE: PBR), commonly called Petrobras, has approved a plan it announced last September to spend $224.7 billion developing an estimated 5 billion barrels of reserves. The spending, which will happen between now and 2015, is the largest planned capex spending in an industry used to spending huge sums.

Petrobras raised about $70 billion in a secondary offering last year, including about $43 billion in new shares to the Brazilian government for the rights to produce oil from the six fields.

The company expects to spend about $55 billion in 2011, slightly less than the $57 billion it spent in 2010. There could be some good news in this planned spending for drilling companies like Noble Corp. (NYSE: NE), Diamond Offshore Drilling Inc. (NYSE: DO), and Transocean Ltd. (NYSE: RIG). Services companies like Halliburton Co. (NYSE: HAL), Baker Hughes Inc. (NYSE: BHI), and Schlumberger Ltd. (NYSE: SLB) could also see a boost. Then again, maybe not.

A lot depends on how Petrobras chooses to proceed. The company announced a tender in June for construction of 21 new drilling rigs that are to built in Brazil. The idea of course is to boost the Brazilian economy by providing jobs. Seven rigs are already under construction in Brazil.

It’s also possible that Petrobras will withdraw the tender, as it did recently with a request for new ships. The company decided the shipbuilding bids were too high.

Earlier this week Petrobras extended its contract for two Diamond semi-submersible rigs in exchange for a $10,000/day drop in the the rental price. Diamond, no doubt, is looking ahead for a bigger piece of the action in the $224.7 billion spending.

Leasing rigs would almost certainly be cheaper than building and maintaining new rigs that Petrobras owns. But there’s always a political dimension to spending figures of this size, and the government may push for more domestic purchasing.

Either way, the company thinks it can nearly triple its production, from around 2 million barrels/day to 6 million by 2020. That is both an aggressive and very expensive plan.

Paul Ausick

Filed under: Oil & Gas Tagged: BHI, DO, HAL, NE, PBR, RIG, SLB

Week’s Market Losers: JC Penney, Schwab, News Corp And More

247wallst — Sat, 09 Jul 2011 11:58:39 +0000

News Corp (NYSE: NWSA) share dropped 3.5% as the company faced a large bribery and phone hack scandal in the UK and closed it New of the World paper. The stock was down more midweek before the paper was shuttered. News Corp’s chance to take over BSkyB, which might has been CEO Rupert Murdoch’s crowning achievement, were damaged.

June retail sales were strong for most firms in the industry. A notable exception was J.C. Penney (NYSE: JCP which posted figures below expectations. It has hired a senior retail executive from Apple (NASDAQ: AAPL) to turn around its fortunes. The move could not happen soon enough. The stock was down almost 4% for the week.

Charles Schwab (NASDAQ: SCHW) was ordered to pay back investors in its YieldPlus Fund. The fund took undisclosed risks. Schwab share closed the week off by 3.6%.

S&P 500 WEEK: BOTTOM 10 (01 JUL – 07 JUL)	Ticker	Weekly Price Change (%)	Close Price 7Jul11	Close Price 1Jul11	Market Cap ($Mil)
Noble Corp	NE	-5.0	37.69	39.67	9504.1
MEMC Electronic Materials Inc	WFR	-4.3	8.21	8.58	1891.7
J. C. Penney Company Inc.	JCP	-3.7	33.73	35.03	7191.5
Schwab (Charles) Corp	SCHW	-3.6	16.12	16.72	19452.5
Motorola Mobility Holdings Inc	MMI	-3.6	22.64	23.48	6677.8
News Corp	NWSA	-3.5	17.43	18.06	31863.9
Masco Corp	MAS	-3.4	12.04	12.46	4311.5
Morgan Stanley	MS	-3.2	23.00	23.76	35527.1
WellPoint Inc	WLP	-3.1	78.27	80.79	28737.8
Western Union Co	WU	-2.8	19.68	20.24	12443.0
Source: Capital IQ

Filed under: Research Tagged: JCP, MAS, MMI, MS, NE, NWSA, SCHW, WFR, WLP, WU

Top Analyst Upgrades & Downgrades (AET, AIG, AXAS, AMAT, FST, FOSL, IBM, KAI, KLAC, NFLX, NE, NOR, OPEN, RAVN, STX, SBUX, TLAB, WDC, YUM)

Administrator — Thu, 07 Jul 2011 12:27:10 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Thursday morning.

Aetna Inc. (NYSE: AET) Reiterated Buy and raised target to $51 at Argus.
American International Group Inc. (NYSE: AIG) Reinstated as Neutral with $32 target at Credit Suisse.
Abraxas Petroleum Corp. (NASDAQ: AXAS) Maintained Buy with $6 target at Canaccord Genuity.
Applied Materials Inc. (NASDAQ: AMAT) Maintained Buy but cut price target to $19 at Argus.
Forest Oil Corporation (NYSE: FST) Cut to Underperform at BofA/ML.
Fossil, Inc. (NASDAQ: FOSL) Cut to Hold at S&P Equity Research (late-Wednesday).
International Business Machines Corp. (NYSE: IBM) Cut to Market Perform at Wells Fargo.
Kadant Inc. (NYSE: KAI) Maintained Buy as Value at Zacks.
KLA-Tencor Corporation (NASDAQ: KLAC) Raised to Buy at UBS.
Netflix, Inc. (NASDAQ: NFLX) Reiterated Buy and raised target to $325 at BofA/ML.
Noble Corporation (NYSE: NE) Cut estimates and Target at Canaccord Genuity; Reiterated Buy at Argus.
Noranda Aluminum Holding Corp. (NYSE: NOR) Cut to Underperform at BofA/ML.
OpenTable, Inc. (NASDAQ: OPEN) Reiterated Buy with $115 target at Canaccord Genuity.
Raven Industries (NASDAQ: RAVN) Reiterated Outperform as Bull of the Day at Zacks.
Seagate Technology PLC (NASDAQ: STX) Raised to Overweight at JPMorgan.
Starbucks Corporation (NASDAQ: SBUX) Cut to Neutral at Goldman Sachs.
Tellabs, Inc. (NASDAQ: TLAB) Cut to Underperform as Bear of the Day at Zacks.
Western Digital Corporation (NYSE: WDC) Raised to Overweight at JPMorgan.
Yum! Brands, Inc. (NYSE: YUM) Cut to Sell at Goldman Sachs.

You are invited to join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Filed under: Analyst Calls Tagged: AET, AIG, AMAT, AXAS, FOSL, FST, IBM, KAI, KLAC, NE, NFLX, NOR, OPEN, RAVN, SBUX, STX, TLAB, WDC, YUM

Top Analyst Upgrades & Downgrades (AGU, CCJ, CHK, ETR, IGT, JDSU, LVS, LINE, NE, OKE, OPEN, SBUX, TXN, TOL)

Administrator — Mon, 14 Mar 2011 12:22:43 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Monday morning.

Agrium Inc. (NYSE: AGU) Raised to Buy at TD.
Cameco Corp. (NYSE: CCJ) Cut to Hold at TD.
Chesapeake Energy Corporation (NYSE: CHK) Reiterated Hold at Argus.
Entergy Corporation (NYSE: ETR) Cut to Underperform at BofA/ML.
International Game Technology (NYSE: IGT) Reiterated Outperform at Credit Suisse.
JDS Uniphase Corporation (NASDAQ: JDSU) Raised to Buy at Citigroup.
Las Vegas Sands Corp. (NYSE: LVS) Cut to Hold at Jefferies.
Linn Energy, LLC (NASDAQ: LINE) Started as Buy at Stifel Nicolaus.
Noble Corp. (NYSE: NE) Raised to Overweight at JPMorgan.
ONEOK Inc. (NYSE: OKE) Cut to Hold at Argus.
OpenTable, Inc. (NASDAQ: OPEN) Cut to Neutral at Merriman.
Starbucks Corporation (NASDAQ: SBUX) Reiterated Outperform and raised target to $41 at Credit Suisse.
Texas Instruments Inc. (NYSE: TXN) Raised to Positive at Susquehanna.
Toll Brothers Inc. (NYSE: TOL) Cut to Sell at Stifel Nicolaus.

You can join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Filed under: Analyst Calls Tagged: AGU, CCJ, CHK, ETR, IGT, JDSU, LINE, LVS, NE, OKE, OPEN, SBUX, TOL, TXN

US Gulf of Mexico Opens for More Deepwater Drilling (NBL, ESV, HLX, NE, DO, RIG, CVX)

247wallst — Tue, 01 Mar 2011 16:23:48 +0000

Two weeks ago, Federal Judge Martin Feldman told the Obama administration to act within 30 days on a number of drilling permits for the deepwater Gulf of Mexico. The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) has now issued the first deepwater Gulf permit since last year’s Macondo well disaster that killed 11 workers and spewed millions of barrels of crude into the Gulf of Mexico. Now the issues becomes how fast will drilling resume.

Noble Energy Inc. (NYSE: NBL) has received a permit to restart drilling at its Santiago prospect. The drilling rig on the project belongs to Ensco plc (NYSE: ESV) and the well is located in 6,500 feet of water. The well had been drilled to more than 13,000 feet below the sea floor before the moratorium was instituted, and is targeted for total drilling depth of 19,000 feet. Noble Energy is a partner in the group of E&P companies that formed a consortium led by Helix Energy Solutions Group, Inc. (NYSE: HLX) to develop improved subsea control and containment capabilities.

The restart signals good news for other drillers, including Noble Corp. (NYSE: NE; not related in any way to Noble Energy), Diamond Offshore Drilling Inc. (NYSE: DO), and Transocean Ltd. (NYSE: RIG), owner of the Deepwater Horizon rig that exploded last April. At the time the moratorium was first initiated, 16 wells operated by 13 different companies were shut-in. These 16 wells will be the first projects to get going again, but the outlook for new wells is more problematic.

BOEMRE has made the requirements stricter for getting a new deepwater Gulf permit. A new project is likely to need a site-specific environmental assessment, which is also required of a continuing project, but may also be required to get a supplemental environmental impact statement, at a much costlier and much lengthier procedure. In its annual survey of US E&P companies, Grant Thornton LLP reports that 68% of senior gas & oil company executives believe an increase in drilling costs by 20% or more due to government regulation would make new E&P projects too expensive to pursue.

As pump prices for gasoline rise in response to political upheaval in Libya (and potentially elsewhere in the oil-rich nations of North Africa and the Middle East), US drivers, who are also voters, will raise a clamor for lower prices and politicians will react. After all, the next election is less than 18 months away.

The New York Times cites the president of Chevron Corp.’s (NYSE: CVX) North American E&P division as calling the Noble Energy permit “a step in the right direction,” but also adding, “It is time for the government to clear the backlog of deepwater drilling permit applications so industry can create the energy, jobs and economic growth our nation needs so badly.”

Notice that Chevron’s executive didn’t say that it’s safe to go back into the deepwater, or that the industry knows what to do to prevent another disastrous blowout. BOEMRE’s chief did note that Noble Energy had met new safety and environmental rules put into place since the Macondo blowout, and that the Helix subsea system Noble Energy will use is capable of meeting government spill-response requirements.

Now that the first permit is out, the pressure on BOEMRE to issue more will only intensify. Industry associations, politicians, and industry players will all be pushing for quicker approval of restarts and faster review and approval of new drilling projects. Everyone who matters assumes that the new regulations will make deepwater drilling safer. The rest of us are left to hope everyone who matters is right.

Paul Ausick

Filed under: General Tagged: CVX, DO, ESV, HLX, NBL, NE, RIG

Oil Field Services Firms’ Earnings are Good Enough (DO, NE, HAL, WFT, SLB, RIG)

247wallst — Thu, 21 Oct 2010 16:37:16 +0000

How investors view the oil field services business depends a lot on whether a company is heavily involved in offshore drilling. Onshore drillers have seen share prices rise steadily as production companies in the US have increased drilling in shale gas areas. Offshore drillers’ shares have taken a pounding due to the moratorium on drilling after the disaster in the Gulf of Mexico.
That may be about to turn around because the moratorium has been lifted and offshore drilling activity picks up and new onshore drilling levels off. Diamond Offshore Drilling Inc. (NYSE:DO) and Noble Corp. (NYSE:NE) reported decent earnings this morning, following good earnings earlier this week from Halliburton Co. (NYSE:HAL) and Weatherford International Ltd. (NYSE:WFT). Schlumberger Ltd. (NYSE:SLB), the largest oil field services firm by market cap, reports tomorrow, and Transocean Ltd. (NYSE:RIG) reports early next month.
Diamond reported an year-over-year EPS decline of 45%, from $2.62 to $1.43. Revenues were down 12% as well, from $908.4 million to $799.7 million. Analysts had been expecting EPS of $1.34 on revenue of $796.5 million. In essence, Diamond cleared a very low bar. To take some of the sting out, the company declared a special cash dividend of $0.75/share payable on December 1 to shareholders of record on November 1.
Noble Corp. saw its revenue fall 32% year-over-year for the quarter. The company posted EPS of $0.34, a penny below estimates, and revenue of $613 million, far below expectations of $635 million. Noble is the second-largest offshore driller in the world, and like Diamond, suffered from the Gulf drilling moratorium. The impact on Transocean is certain to be harsh as well.
Halliburton and Weatherford were much less exposed to the downturn in offshore activity, even though Halliburton was the cement contractor on the blown-out Gulf well. Weatherford’s international revenue fell off more than 6% in the quarter, and its Mexico operations were severely hit. The company’s rig count fell from 50 at the beginning of 2010 to just 3 at the end of the third quarter.
Schlumberger is expected to post third-quarter EPS of $0.70 on revenue of $6.83 billion when it reports earnings tomorrow. Like Halliburton, Schlumberger’s results are expected to be good due to its extensive onshore operations.
After rising in early trading, Diamond shares are down about 1% at noon, while Noble’s shares are off about -1.4%. Halliburton shares are up about 1%, Weatherford and Transocean shares are down about -0.5%, and Schlumberger shares are off about -0.25%.
Paul Ausick

Filed under: Oil & Gas Tagged: DO, HAL, NE, SLB, WFT