Transocean (NYSE:RIG) Trading 6.8% Higher Following Analyst Upgrade

Key Points

• Transocean shares rose 6.8% to about $5.62 after Fearnley Fonds upgraded the stock from hold to strong buy, although trading volume was far below average.
• Analyst sentiment remains mixed: MarketBeat reports an average “Hold” rating and an average price target of $6.82, with one strong-buy, three buy, four hold, and three sell ratings.
• Transocean exceeded quarterly expectations, reporting $0.03 in EPS versus a $0.01 estimate and $966 million in revenue, but revenue declined 2.2% year over year and the company continues to post a negative net margin.

Transocean Ltd. (NYSE:RIG - Get Free Report) shot up 6.8% on Monday after Fearnley Fonds upgraded the stock from a hold rating to a strong-buy rating. The stock traded as high as $5.59 and last traded at $5.6160. 5,502,769 shares were traded during trading, a decline of 86% from the average session volume of 39,987,340 shares. The stock had previously closed at $5.26.

Several other brokerages also recently commented on RIG. Susquehanna reduced their target price on Transocean from $8.00 to $7.00 and set a "positive" rating for the company in a research note on Wednesday, July 8th. Morgan Stanley increased their price target on Transocean from $5.00 to $7.00 and gave the stock an "equal weight" rating in a report on Wednesday, April 15th. Barclays raised Transocean from an "equal weight" rating to an "overweight" rating and raised their price objective for the company from $6.00 to $8.00 in a research note on Thursday, May 7th. Weiss Ratings restated a "sell (d-)" rating on shares of Transocean in a report on Friday, July 17th. Finally, TD Cowen increased their price objective on Transocean from $5.50 to $6.00 and gave the stock a "hold" rating in a research note on Wednesday, May 6th. One analyst has rated the stock with a Strong Buy rating, three have given a Buy rating, four have issued a Hold rating and three have issued a Sell rating to the company. Based on data from MarketBeat, the company has an average rating of "Hold" and an average price target of $6.82.

Insider Buying and Selling at Transocean

In other news, Director Chad C. Deaton acquired 35,000 shares of the firm's stock in a transaction that occurred on Thursday, July 2nd. The stock was bought at an average price of $4.95 per share, with a total value of $173,250.00. Following the acquisition, the director owned 237,421 shares in the company, valued at $1,175,233.95. The trade was a 17.29% increase in their position. The acquisition was disclosed in a document filed with the SEC, which is accessible through the SEC website. Insiders own 9.70% of the company's stock.

Hedge Funds Weigh In On Transocean

Large investors have recently modified their holdings of the business. Elliott Investment Management L.P. bought a new position in shares of Transocean in the first quarter worth $103,606,000. Zimmer Partners LP bought a new stake in shares of Transocean during the third quarter valued at about $30,262,000. Assenagon Asset Management S.A. purchased a new stake in shares of Transocean in the second quarter worth about $37,477,000. Barclays PLC lifted its holdings in shares of Transocean by 230.6% in the fourth quarter. Barclays PLC now owns 10,802,664 shares of the offshore drilling services provider's stock worth $44,615,000 after buying an additional 7,535,041 shares in the last quarter. Finally, Dimensional Fund Advisors LP boosted its position in shares of Transocean by 20.9% in the fourth quarter. Dimensional Fund Advisors LP now owns 43,470,312 shares of the offshore drilling services provider's stock valued at $179,531,000 after acquiring an additional 7,516,589 shares during the period. Hedge funds and other institutional investors own 67.73% of the company's stock.

Transocean Price Performance

The business's 50-day moving average price is $5.38 and its 200 day moving average price is $5.91. The company has a market capitalization of $6.27 billion, a P/E ratio of -2.99, a price-to-earnings-growth ratio of 3.75 and a beta of 1.32. The company has a quick ratio of 1.27, a current ratio of 1.59 and a debt-to-equity ratio of 0.56.

Transocean (NYSE:RIG - Get Free Report) last posted its earnings results on Wednesday, August 5th. The offshore drilling services provider reported $0.03 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.01 by $0.02. Transocean had a negative net margin of 40.24% and a positive return on equity of 2.60%. The business had revenue of $966.00 million for the quarter, compared to analysts' expectations of $956.64 million. During the same period in the prior year, the company posted ($1.06) EPS. The business's revenue for the quarter was down 2.2% compared to the same quarter last year. Analysts anticipate that Transocean Ltd. will post 0.13 EPS for the current fiscal year.

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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