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Started By
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Anyone buying RIG?
Posted on 2/24/15 at 9:28 am
Posted on 2/24/15 at 9:28 am
Morningstar just upped them to 5 star
received downgrades from a number of analysts recently
insiders buying
Slashed dividend recently from 3 to .60
received downgrades from a number of analysts recently
insiders buying
Slashed dividend recently from 3 to .60
This post was edited on 2/24/15 at 9:34 am
3
Posted on 2/24/15 at 9:32 am to Ole War Skule
I'd like to buy its hard for me to buy oil stocks after losing so much money recently
Posted on 2/24/15 at 10:16 am to TheIndulger
there are other sites saying RIG is getting ready to be downgraded to junk status. Do not know who to follow.
Posted on 2/24/15 at 10:26 am to ntgreek00
But, I will say that RIG is one of the largest offshore drillers and I think that they will come back. It may take some time but there are only a handful a companies that cn do what RIG can do.
Posted on 2/24/15 at 2:00 pm to Ole War Skule
I just heard on CNBC that Barclays is saying that a downgrade of the debt could be coming as soon as tomorrow. Might want to check on it.
CNBC
CNBC
Posted on 2/24/15 at 3:24 pm to Ole War Skule
Rig should be avoided at all cost right now IMHO.
They are the least likely major drilling contractor to survive. Transocean was having a cash flow problem before the downturn. Now if you think the assets are worth enough to give it a shot as a buyout target go ahead. This is the most likely scenario that I see happening.
They are the least likely major drilling contractor to survive. Transocean was having a cash flow problem before the downturn. Now if you think the assets are worth enough to give it a shot as a buyout target go ahead. This is the most likely scenario that I see happening.
Posted on 2/24/15 at 3:27 pm to cave canem
I don't understand why the deepwater drilling companies got hammered so bad. The deepwater is the most static of oil and gas fronts in the US. I don't think the rig count has changed much, of at all
Posted on 2/24/15 at 7:04 pm to TheIndulger
quote:
I don't understand why the deepwater drilling companies got hammered so bad. The deepwater is the most static of oil and gas fronts in the US. I don't think the rig count has changed much, of at all
There was a coming rig glut in the deepwater business downturn or not, too many newbuilds and not enough contracts to go around. The companies are getting hammered on future contracts and revenue as much as the present. All that being said there has been a pretty good reduction in both day rate and rig count and it looks to get worse soon. Transocean was in limp mode already and had this currant downturn not occurred they would have been on thin ice anyway.
Posted on 2/24/15 at 10:55 pm to cave canem
quote:
There was a coming rig glut in the deepwater business downturn or not, too many newbuilds and not enough contracts to go around.
I don't really agree with this. If oil would reach $75+ the deepwater rigs will stay working. The problem is the cost of the rig, maintenance, labor and regulatory compliance is killing their profit. They just don't make that much profit on deepwater rigs.
It took $235,000 a day to run a 5th gen deepwater semi 4 years ago in Brazil. And that was as cheap as they could run it. Rarely spent money on the rig.
Posted on 2/25/15 at 8:37 am to offshoretrash
quote:
I don't really agree with this.
Cool don't take my word for it.
quote:
Transocean Ltd, the owner of the world's largest offshore drilling fleet, said it was likely to retire additional rigs as the company continued to face pressure due to slowdown in an oversupplied rig market
LINK
quote:
Tumbling oil prices and a glut in rig supply have been a double blow for the owner of the world’s largest deep-water drilling fleet. A four-year low in crude has pushed energy companies to consider spending cuts, which could further damp demand for leasing rigs. Transocean has the biggest exposure to rigs that could go idle in 2015, said Robert Pinkard of RBC Capital Markets.
LINK
quote:
Since Offshore published the last survey in 2012, the number of deepwater rigs capable of drilling in 4,000 ft of water or more and to reservoir depths of 25,000 ft or greater has grown to 197. This represents a 22% increase from the 161 rigs counted in the 2012 survey. It also represents a 67% jump from four years ago, when the deepwater drilling industry was still in the early days of the US drilling moratorium imposed after the Macondo well spill in the Gulf of Mexico (GoM).
Again JMHO but RIG is circling the toilet bowl as an independent company. Their next fleet status report is due in April and from what I have been able to gather it is going to be ugly.
quote:
I don't really agree with this. If oil would reach $75+ the deepwater rigs will stay working
Dude deepwater is as dead as Jimmy Hoffa at $75 oil. Sure there will be some exploration but not near enough to go around and tote the note on all the existing rigs + all the newbuilds rolling out.
Posted on 2/25/15 at 10:51 am to cave canem
Add to all that the long term exploration budgets of all the majors are being cut significantly.
Posted on 2/25/15 at 11:37 am to cave canem
quote:
Transocean Ltd, the owner of the world's largest offshore drilling fleet, said it was likely to retire additional rigs
These are not 5th or later generation rigs these are old rigs that cost more to upgrade than build a new one. Every company is doing this and has been for some time.
quote:
the number of deepwater rigs capable of drilling in 4,000 ft of water or more
These are not what I would call deep water rigs. These these are mid depth rigs. IMO deep water is over 7500'. There is not an over supply of these type rigs. DP, new generation rigs are favored over these old rigs. There are some idol right now yeah because of the scare of oil prices. But to say deepwater rigs can only work if oil is around 100 dollars a barrel is bullshite. What is oil never goes above 80 dollars? The vast majority of the idol floating rigs are the mid depth rigs.
Posted on 2/25/15 at 2:26 pm to offshoretrash
We shall see how it turns out for Transocean. Looks like you are more optimistic than anyone I have met, you could be right.
Posted on 2/25/15 at 7:36 pm to cave canem
quote:
Dude deepwater is as dead as Jimmy Hoffa at $75 oil
I agree with a lot of what you said but this is simply not true. DW exploration will continue to happen (at a reduced rate but not dead). There are megafields out on the ultra DW waiting to be discovered. Most of the companies at play in the DW have strong balance sheets and can afford to still spend in this depressed price environment. The timelines for DW projects are much longer than onshore and shelf projects so they have that advantage when it comes to price forecasts. Also there will continue to be appraisal and development drilling on the already discovered huge fields in the DW. Fields where initial production may not occur until the 2018-2020 timeframe when most predict prices will be back in the $80-100 bbl range.
This post was edited on 2/25/15 at 7:37 pm
Posted on 2/25/15 at 8:59 pm to lsugradman
quote:
I agree with a lot of what you said but this is simply not true. DW exploration will continue to happen (at a reduced rate but not dead). There are megafields out on the ultra DW waiting to be discovered. Most of the companies at play in the DW have strong balance sheets and can afford to still spend in this depressed price environment. The timelines for DW projects are much longer than onshore and shelf projects so they have that advantage when it comes to price forecasts. Also there will continue to be appraisal and development drilling on the already discovered huge fields in the DW. Fields where initial production may not occur until the 2018-2020 timeframe when most predict prices will be back in the $80-100 bbl range.
Again we will see. This battle for market share can end in several different ways.
Posted on 2/25/15 at 10:17 pm to cave canem
quote:
Looks like you are more optimistic than anyone I have met, you could be right.
I'm not gonna lie, I am worried about the market and it could be a while before things pick back up. My salary has been cut 50k a year. Lucky the company I work for is in pretty good shape with only one rig idol. We just signed 3 year extensions on 2 drillships in Brazil and an 800K a day contract for one of our floaters.
Petrobras is on very thin ice but if they go under Brazil goes under. I'm not sure how all this is gonna unfold.
Posted on 2/25/15 at 10:26 pm to offshoretrash
I've been buying Hornbeck, ticker HOS. The stock is down around 55% and I think its cheap for what you're buying.
Todd Hornbeck has personally bought $400,000 worth of shares in the last 10 days half of which he bought the same day I started buying which makes me think I was on the right track. The rig guys I don't know enough about to touch.
Todd Hornbeck has personally bought $400,000 worth of shares in the last 10 days half of which he bought the same day I started buying which makes me think I was on the right track. The rig guys I don't know enough about to touch.
Posted on 2/25/15 at 10:46 pm to offshoretrash
quote:
I'm not sure how all this is gonna unfold.
This is a showdown over market share and an effort by the Saudi government to demonstrate that supply should be limited by producers to the level of demand. The idea of Drill Baby Drill built these rigs and the oversupply, we may not return to that level of exploration for decades. Couple this with the amount of new builds steaming out of shipyards over the next few years and times may get very tough for deepwater drillers soon. JMHO
The original topic was about Transocean (RIG) and I stand by my comments as my best answer to the OP.
Posted on 2/26/15 at 7:11 am to cave canem
Been downgraded to junk status.
Just saw on ticker on Good Morning America.
Just saw on ticker on Good Morning America.
Posted on 2/26/15 at 7:39 am to tes fou
quote:
tes fou
I will be unloading almost all my captial into HOS soon. We saw this same action in 08-09 and the stock came roaring back. Solid company with tons of assets. Clear buy at these levels.
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