) to outperform from neutral.
On Tuesday the company posted $0.24 vs. $0.16 first quarter earnings per share from operations. Analyst Mark Urness says rig operating expenses fell by nearly $59 million sequentially due to cold-stacking idle rigs, the deferral of discretionary rig maintainence programs, and the implementation of successful cost containment initiatives. He notes domestic jack-up market fundamentals also are improving.
Urness says deep water drilling markets are in balance, with the exception of the Gulf of Mexico, where utilization stands at 60%. He raised his $0.90 2002 EPS estimate to $1.10, and upped his $1.85 2003 estimate to $1.95. Urness also raised his $33 target to $41.