Two companies that have hit rough patches but look like long-term buys are below.
Transocean (RIG) – “Transocean Ltd. provides offshore contract drilling services for oil and gas wells worldwide. It offers deep water and harsh environment drilling, oil and gas drilling management, and drilling engineering and drilling project management services”. (Business description from Yahoo Finance)
4 reasons RIG is a solid long-term buy:
The stock is selling at less than 3 times 2007 peak earnings of $14 a share. Insiders made new purchases in December RIG is selling way under book value and is selling at the bottom of its five-year valuation range based on P/S and P/CF. Transocean is significantly under analysts’ price targets. S&P has a $58 on RIG and the median analysts’ price target is $65 on the stock. Disclosure from author: I have no positions in any stocks mentioned, but may initiate a long position in RIG over the next 72 hours.
"Transocean (RIG) shares are trading at $39.89. Transocean is an offshore drilling company. These shares have traded in a range between $38.76 to $85.98 in the last 52 weeks. The 50-day moving average is $48.19 and the 200-day moving average is $59.99. Earnings estimates indicate a profit of $1.59 per share for 2011, and $3.22 for 2012. RIG shares dropped significantly due to their involvement in the oil spill in the Gulf of Mexico. Transocean will benefit from increased demand for their offshore rigs in the Barents Sea as exploration activity heats up in the region, and all over the world due to higher oil prices. However, I would wait for a further drop in these shares before considering an investment, as this company still faces issues and expenses from the BP oil spill and will probably see a dividend cut. An insider recently bought 6,500 shares."
That is only one of four reasons, also, 1)two officers bought about $300K in stock, token to some, not me. And 2)They paid five dollars more than it is now. NOt a reason to mortgage the house to buy, but, it is a reason to look. I am only day and swing trading RIG for now, but as I mentioned earlier, this may be a bottom (again, assuming the Feds have no smoking gun). Good luck