Transocean (NYSE:RIG) Shares Down 3.8% - What's Next?

Key Points

• Transocean shares fell 3.8% mid-day to $6.385 (intraday low $6.36) on volume of about 7.3 million shares, roughly an 83% decline from the average session volume.
• Analysts are mixed: the consensus rating is "Reduce" with an average price target of $6.46 (2 Buys, 5 Holds, 3 Sells); recent notable moves include Pareto cutting to "sell" with a $5.25 target while Susquehanna raised its target to $8.00.
• Insiders have been net sellers (CEO and EVP recently sold shares), and Transocean reported a quarterly EPS miss ($0.02 vs. $0.09 expected) despite revenue rising ~9.6% year-over-year, leaving the company with a negative net margin and a market cap near $6.9 billion.

Transocean Ltd. (NYSE:RIG - Get Free Report)'s share price fell 3.8% during mid-day trading on Tuesday . The company traded as low as $6.36 and last traded at $6.3850. 7,303,153 shares traded hands during trading, a decline of 83% from the average session volume of 43,972,766 shares. The stock had previously closed at $6.64.

Analysts Set New Price Targets

A number of research firms have issued reports on RIG. Pareto Securities lowered shares of Transocean from a "hold" rating to a "sell" rating and set a $5.25 target price for the company. in a research note on Tuesday, February 10th. Morgan Stanley boosted their target price on shares of Transocean from $4.50 to $5.00 and gave the company an "equal weight" rating in a research note on Monday, February 23rd. Susquehanna boosted their target price on shares of Transocean from $7.50 to $8.00 and gave the company a "positive" rating in a research note on Tuesday, April 7th. Fearnley Fonds lowered shares of Transocean from a "strong-buy" rating to a "hold" rating in a research note on Tuesday, February 10th. Finally, Clarkson Capital lowered shares of Transocean from a "strong-buy" rating to a "hold" rating in a research note on Thursday, March 19th. Two investment analysts have rated the stock with a Buy rating, five have assigned a Hold rating and three have given a Sell rating to the company. Based on data from MarketBeat.com, the stock presently has an average rating of "Reduce" and an average price target of $6.46.

Transocean Trading Down 5.9%

The firm has a market capitalization of $6.91 billion, a price-to-earnings ratio of -1.99 and a beta of 1.37. The firm's 50 day moving average is $6.29 and its 200 day moving average is $4.82. The company has a quick ratio of 1.27, a current ratio of 1.56 and a debt-to-equity ratio of 0.64.

Transocean (NYSE:RIG - Get Free Report) last released its earnings results on Friday, February 20th. The offshore drilling services provider reported $0.02 EPS for the quarter, missing the consensus estimate of $0.09 by ($0.07). Transocean had a negative net margin of 73.52% and a positive return on equity of 0.41%. The business had revenue of $1.04 billion for the quarter, compared to analyst estimates of $1.03 billion. During the same period in the prior year, the company earned ($0.09) earnings per share. The firm's revenue for the quarter was up 9.6% on a year-over-year basis. Equities analysts forecast that Transocean Ltd. will post 0.14 earnings per share for the current year.

Insider Buying and Selling

In other news, CEO Keelan Adamson sold 58,687 shares of the business's stock in a transaction that occurred on Tuesday, January 27th. The shares were sold at an average price of $5.00, for a total transaction of $293,435.00. Following the sale, the chief executive officer owned 1,222,182 shares in the company, valued at $6,110,910. The trade was a 4.58% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Roderick James Mackenzie sold 78,370 shares of the business's stock in a transaction that occurred on Wednesday, March 4th. The shares were sold at an average price of $6.36, for a total transaction of $498,433.20. Following the sale, the executive vice president owned 268,025 shares in the company, valued at $1,704,639. This represents a 22.62% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 159,903 shares of company stock worth $906,098 in the last 90 days. 12.27% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Large investors have recently added to or reduced their stakes in the stock. TD Waterhouse Canada Inc. increased its stake in Transocean by 22,432.1% in the 4th quarter. TD Waterhouse Canada Inc. now owns 6,309 shares of the offshore drilling services provider's stock valued at $26,000 after buying an additional 6,281 shares during the period. Josh Arnold Investment Consultant LLC acquired a new position in Transocean in the 2nd quarter valued at approximately $26,000. Flagship Harbor Advisors LLC acquired a new position in Transocean in the 4th quarter valued at approximately $27,000. Benedict Financial Advisors Inc. acquired a new position in Transocean in the 3rd quarter valued at approximately $31,000. Finally, Vestmark Advisory Solutions Inc. acquired a new position in Transocean in the 3rd quarter valued at approximately $31,000. Institutional investors and hedge funds own 67.73% of the company's stock.

About Transocean

Transocean Ltd. is a leading international provider of offshore contract drilling services for the oil and gas industry. The company specializes in the operation of mobile drilling units, including ultra-deepwater drillships, semisubmersible rigs and high-specification jackup rigs. Transocean's fleet is designed to meet complex drilling requirements, from ultra-deepwater well construction to shelf exploration and development projects.

The company's core services encompass the full spectrum of offshore drilling operations, including project and engineering management, marine operations, drilling supervision, and maintenance support.

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