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Rowan's (RDC) Q1 Loss Wider Than Expected, Revenues Lag

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Rowan Companies plc reported adjusted first-quarter 2018 loss from continuing operations of 89 cents per share, wider than the Zacks Consensus Estimate of a loss of 86 cents. The company had posted profit of 7 cents per share in the year-ago quarter. The decline was mainly due to a considerable fall in dayrates and lower rig utilization.
 

Rowan Companies PLC Price, Consensus and EPS Surprise

 

Rowan Companies PLC Price, Consensus and EPS Surprise | Rowan Companies PLC Quote

Total revenues were $211.2 million in the first quarter, down from $374.3 million in the prior-year quarter. Revenues also lagged the Zacks Consensus Estimate of $216 million.
 
Dayrates and Utilization  

The company's deepwater rigs had a dayrate of $574,600 compared with $592,100 in the year-ago quarter. Jackup rigs saw a dayrate of $138,900 against $135,700 in the prior-year quarter.

The overall dayrate of all rigs was $176,700 compared with $203,500 in first-quarter 2017. Average utilization of the company's rigs was 50% against 75% in the comparable quarter last year.

Total Expenses

In the first quarter, the company reported $282.2 million in costs compared with $298 million in the year-quarter.

Financials

As of Mar 31, 2018, the company's cash balance was $1,214.1 million and long-term debt (including current maturities) was $2,510.5 million. The long-term debt-to-capitalization ratio was 32.2%.  

Q1 Price Performance

During the January-to-March period, Rowan’s shares lost 26.3% compared with the industry’s 13.9% decline.

Zacks Rank & Key Picks

Rowan currently carries a Zacks Rank #3 (Hold).

A few better-ranked players in the same sector are Nine Energy Service, Inc (NINE - Free Report) , Baytex Energy Corp (BTE - Free Report) and Solaris Oilfield Infrastructure, Inc. (SOI - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Nine Energy Service is engaged in delivering onshore completion and production services to unconventional oil and gas resource development. The company pulled off a positive earnings surprise of 6.25% in the preceding quarter.

Baytex Energy is a conventional oil and gas income trust focused on maintaining its production and asset base through internal property development and delivering consistent returns to its unitholders. The company delivered an average positive earnings surprise of 77.3% in the trailing three quarters.

Solaris Oilfield Infrastructure manufactures as well as provides patented mobile proppant management systems which unload, store and deliver proppant at oil and natural gas well sites. The company delivered a positive earnings surprise of 5.26% in the preceding quarters.

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