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SeaDrill Limited Message Board

  • play_tow play_tow Apr 16, 2014 4:08 PM Flag

    ENSCO Contract Signing Raise Doubts about Credit Suisse Views

    ESV signed several contracts recently, all for greater day rates, and in some cases for floater equipment long in the tooth.

    Yet, Credit Suisse not only warns that day rates are falling hard, but that a weakening market is forcing SDRL to sell its assets.

    It is hard to reconcile the ESV contract signings with Credit Suisse interpretation,

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    • "We continue to believe the more guarded exploration and production spending pattern shown by some operators during early 2014 is temporary and that contract visibility, especially in the floating rig segment, is likely to improve as we progress further into 2014 and 2015. "Despite the current market dynamics, Noble is well positioned with limited near-term fleet exposure, a large revenue backlog, strong client relationships, well-timed premium rig additions with attractive contracts, a rapidly declining capital expenditure commitment and successful implementation of new operating systems and procedures that are driving improved financial performance. We continue to anticipate improving free cash flow in 2015 despite current industry developments. We believe the offshore drilling business remains fundamentally sound over the long-term and Noble is better positioned to address the opportunities expected with the next cyclical upturn with a more versatile and focused fleet run by skilled and highly competent crews."

      So listen to paper pushers from CS or people actually in the business.

      Sentiment: Strong Buy

    • NE's earnings release statement concerning off shore drilling contradicts the Credit Suisse thesis that off shore drilling is in a multi-year downtrend.

    • You can't trust these guys. They knock the price down to get their best clients in. Go read the just released earnings report from Noble. Profits up and utilization is up. And when SDRL reports their numbers will be solid as well. Seriously take advantage and buy. I would even buy January 2016 calls. And I did heheh.

      Sentiment: Strong Buy

    • I wonder what Credit Suisse is smoking. I think lots of reports we get from so-called experts are totally wrong. I use to listen to our good friend Jim C. and many times he is wrong also. I feel that SDRL is good for now with the large div and that it will bounce back nicely in time. I am tired of selling and losing money on what the experts say. If they were always so right, then they would not need to work and just retire with all the gains, lol.I am long on SDRL and short on Credit Suisse. GLTU

      • 2 Replies to sidney_greenburg
      • The constant trashing SDRL is getting on an almost daily basis is evidence that on WS, BS will trump fundamentals, at least in the short term. If you believe CS, you'd have to conclude that SDRL's management is incompetent and/or crooked. That may be true of some managements, but in this case it is much more likely true of CS's than of SDRL's.

      • Totally agree, I don't put any faith in downgrades or upgrades. S&P has had a sell rating on GRMN Garmin forever and several others did also. Now GRMN goes over 50.00 and they raise it to buy or outperform, how brilliant. I trade SDRL a little and these things are at times helpful to get me back in the stock for the next runup. GLTA

 
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