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Transocean (RIG) Falls More Steeply Than Broader Market: What Investors Need to Know

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In the latest market close, Transocean (RIG - Free Report) reached $6.12, with a -1.61% movement compared to the previous day. The stock trailed the S&P 500, which registered a daily loss of 0.28%. Meanwhile, the Dow lost 0.08%, and the Nasdaq, a tech-heavy index, lost 0.42%.

The the stock of offshore oil and gas drilling contractor has risen by 30.95% in the past month, leading the Oils-Energy sector's gain of 6.42% and the S&P 500's gain of 2.67%.

The upcoming earnings release of Transocean will be of great interest to investors. The company is forecasted to report an EPS of -$0.09, showcasing a 76.32% upward movement from the corresponding quarter of the prior year. Meanwhile, our latest consensus estimate is calling for revenue of $780 million, up 20.18% from the prior-year quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $0.09 per share and revenue of $3.68 billion. These totals would mark changes of +109.38% and +28.41%, respectively, from last year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Transocean. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 27.38% lower. Transocean is holding a Zacks Rank of #3 (Hold) right now.

From a valuation perspective, Transocean is currently exchanging hands at a Forward P/E ratio of 71.38. Its industry sports an average Forward P/E of 14.93, so one might conclude that Transocean is trading at a premium comparatively.

The Oil and Gas - Drilling industry is part of the Oils-Energy sector. With its current Zacks Industry Rank of 217, this industry ranks in the bottom 14% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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