Money Matters, Simplified.
4-Star Stocks Poised to Pop: Diamond Offshore
Thu, 12/23/2010 - 07:06 by Brian D. Pacampara
Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, contract driller Diamond Offshore Drilling(NYSE: DO) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Diamond Offshore's business and see what CAPS investors are saying about the stock right now.
Diamond Offshore facts
Headquarters (founded) | Houston (1989) |
Market Cap | $8.9 billion |
Industry | Oil and gas drilling |
Trailing-12-Month Revenue | $3.37 billion |
Management | CEO Lawrence Dickerson (since 2008) CFO Gary Krenek (since 1998) |
Return on Equity (average, past 3 years) | 35% |
Dividend Yield | 0.8% |
Competitors | Transocean (NYSE: RIG) Noble (NYSE: NE) Nabors (NYSE: NBR) |
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 98% of the 2,001 members who have rated Diamond Offshore believe the stock will outperform the S&P 500 going forward. These bulls include umps15 and KnockoutMouse.
Late last month , umps15 tapped Diamond Offshore as a particularly slick pick: "good forward p/e at about 10, poised to pop once fears of the BP (NYSE: BP) disaster [subside], and drilling is returned to full strength."
2010 has certainly been a brutal year for Diamond Offshore investors, but with the Gulf of Mexico returning to at least some sense of normalcy, many Fools believe it's just a matter of time before the valuation does, too. Over the past year, shares of Diamond Offshore have been beaten down (-31%) more than rivals Noble (-14%), Nabors (0.8%), and Pride International (NYSE: PDE) (-3%), as well as those at the heart of disaster, BP (-21%) and Transocean (-16%).
CAPS All-Star KnockoutMouse drills deeper:
Our dependence on oil is not going away anytime soon, and the deep water is where the oil is. This is a great company. They have a fleet of very safe and modern deep-water rigs. They have been strategic with their upgrades and new rig purchases, they have been prudent with their cash and they have taken very good care of their shareholders.
© 2010 UCLICK L.L.C.
