Oilfield Services & Equipment
2013 Investor Sentiment Survey
10 pages, 7 exhibits Download link at the bottom of this page sendspace.com
Position Your Energy Portfolios Accordingly – Prior to the Christmas and
New Years’ holiday break, we sent out a very brief survey to investors and
corporate representatives asking them for their opinions on the OFS space,
crude oil and natural gas prices, as well as the best uses of excess cash in
2013. The results of our survey are included herein and the optimism of the
results is starting to take hold in the stocks – we believe. 60% of our
survey’s respondents expect OFS stocks to outperform the market. Said
differently, more than 87% of respondents expect OFS stocks to perform in
line with the market if not better. Barring any geopolitical issues or industry
accidents, 2013 looks to be a good year to be overweight service names.
2013 Top Ideas (HAL and RDC) – Among the large-cap, diversified names,
our top idea for 2013 is HAL, whose leading returns, positive economic
value add (EVA), improving North American margin profile and valuation
discount to its peers make it attractive. RDC is our top offshore drilling idea.
RDC has a best-in-class high-spec/premium jackup fleet and should benefit
from continued increases in dayrates and contract durations. Additionally,
RDC has traded at a discount to the offshore drillers, partially as the result of
its absence from the deepwater. However, with 4 newbuild drillships
scheduled for delivery over the next two years, we expect the valuation gap
to narrow. |
