We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Transocean (RIG) Ultra Deepwater Drillship Contract to End
Read MoreHide Full Article
Shares of Transocean Ltd. (RIG - Free Report) declined more than 7% on Sep 21 after the company received a notice of termination for one of its drillships from the oil giant Chevron Corporation (CVX - Free Report) . The contract pertains to Transocean’s ultra deepwater drillship — Discoverer Clear Leader — operating in the Gulf of Mexico. The contract will be terminated effective November 2017, nearly a year prior to its expiry in October 2018. The drillship has been under contract since 2014 at a dayrate of $575,000.
Per the terms of the contract, Transocean will receive $148 million as compensation. The compensation amount is the present value of the operating dayrate less the operating costs per day. The termination of contract is in line with Chevron’s aim to cut operating and capital costs as it suffering from cash flow deficits.
The contact termination for DiscovererClear Leader is likely to adversely impact Transocean’s revenues and earnings. The company will be liable to pay for the drillship’s stacking costs until it secures another contact for the same.
Transocean is one of the world’s largest offshore drilling contractors along with the likes of Atwood Oceanics, Inc. and Diamond Offshore Drilling, Inc. . The company’s technologically advanced drilling fleet and aggressive cost-cut initiatives bodes well. However, Transocean is already facing pressure on top line. In the second quarter, the company suffered a 20% decline in revenues year over year as old contracts have rolled off. Due to this, the company has either to stack those rigs or accept them at a much reduced dayrates leading to lower revenues. Continued pressure on commodity prices are attributed to the decline in revenues.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Transocean (RIG) Ultra Deepwater Drillship Contract to End
Shares of Transocean Ltd. (RIG - Free Report) declined more than 7% on Sep 21 after the company received a notice of termination for one of its drillships from the oil giant Chevron Corporation (CVX - Free Report) . The contract pertains to Transocean’s ultra deepwater drillship — Discoverer Clear Leader — operating in the Gulf of Mexico. The contract will be terminated effective November 2017, nearly a year prior to its expiry in October 2018. The drillship has been under contract since 2014 at a dayrate of $575,000.
Per the terms of the contract, Transocean will receive $148 million as compensation. The compensation amount is the present value of the operating dayrate less the operating costs per day. The termination of contract is in line with Chevron’s aim to cut operating and capital costs as it suffering from cash flow deficits.
The contact termination for DiscovererClear Leader is likely to adversely impact Transocean’s revenues and earnings. The company will be liable to pay for the drillship’s stacking costs until it secures another contact for the same.
Transocean is one of the world’s largest offshore drilling contractors along with the likes of Atwood Oceanics, Inc. and Diamond Offshore Drilling, Inc. . The company’s technologically advanced drilling fleet and aggressive cost-cut initiatives bodes well. However, Transocean is already facing pressure on top line. In the second quarter, the company suffered a 20% decline in revenues year over year as old contracts have rolled off. Due to this, the company has either to stack those rigs or accept them at a much reduced dayrates leading to lower revenues. Continued pressure on commodity prices are attributed to the decline in revenues.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>