Hercules Offshore, Inc. (Nasdaq:HERO) will probably have its international earnings pressure profits going forward because of the rolling over of contract to existing market rates, according to FBR Capital.
"We are introducing our 2012 estimates (0.75), which are meaningfully lower than our 2011 estimates due to lower international earnings as contracts roll over to current market rates. We maintain our Market Perform rating as we view HERO's risk-reward profile as roughly balanced. The company has the optionality from improvement in the shallow water GOM activity and de-leveraging," said FBR.
Hercules, which offers shallow-water drilling and marine services to the oil and natural gas exploration and production industry, closed Tuesday at $2.42, gaining $0.06, or 2.54 percent. FBR has a price target of $3.50 on them.
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