RIG

Transocean Ltd.

Industrial/Transportation


Presented:02/18/2015
Price:$17.41
Cap:N/A
Current Price:$4.00
Cap:$3.50B

Presented

Date02/18/2015
Price$17.41
Market CapN/A
Ent Value$14.14B
P/E RatioN/A
Book Value$40.32
Div Yield15.7%
Shares O/S362.24M
Ave Daily Vol15,090,000
Short Int31.25%

Current

Price$4.00
Market Cap$3.50B
Transocean Ltd., together with its subsidiaries, provides offshore contract drilling services for oil and gas wells worldwide. The company primarily offers deepwater and harsh environment drilling, and oil and gas drilling management services. As of January 15, 2015, it owned or had partial ownership interests in, and operated 71 mobile offshore drilling units that consist of 44 high-specification floaters, 17 midwater floaters, and 10 high-specification jackups. The company serves independent and government-controlled oil companies. Transocean Ltd. was founded in 1953 and is based in Vernier, Switzerland.

Publicly traded companies mentioned herein: Anadarko Petroleum Corporation (APC), Cheniere Energy Inc (LNG), Diamond Offshore Drilling Inc (DO), Petroleo Brasileiro SA (PBR / PETR4 BZ), Royal Dutch Shell PLC (RDS/A / RDSA LN), Repsol SA (REP SM), Transocean Ltd (RIG)

Highlights

The presenter is short a number of players in the offshore drilling industry, and focused his comments on shares of Transocean (RIG), which is particularly vulnerable given the prevailing market environment. “Even at $100 per barrel oil, RIG appeared to have a real problem,” he stated. The company was on pace to generate $3+ billion of EBITDA and had a $17 billion EV. The EV is now likely to balloon to $20 billion as debt rises and EBITDA could come in at just $1 billion on a mark-to-market basis. It appears as though value investors are stepping in and buying shares on the belief that shares have bottomed, which has created a potentially attractive re-entry point in the $17 - $18 range for bears.

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