Pride Int'l Has Much to Boast
Pride International, Inc.?s (PDE) second-quarter 2008 results came in better than expected, reflecting higher dayrates for its deepwater rigs and improved efficiency from its Gulf of Mexico (GoM) rigs. Revenue and operating earnings from the company?s deepwater fleet increased 25% and 42% year-over-year, respectively.
Overall worldwide jack-up markets strengthened during the quarter, especially in the GOM. With a $10 billion backlog, Pride offers significant earnings and cash flow visibility. We are keeping our recommendation, estimates and price objective unchanged at this stage.
The Offshore Drilling Services segment is the primary contributor to the company?s revenue. Revenue from the company?s Offshore Drilling Services segment was up slightly sequentially and more than 6% year-over-year to $533.9 million. The segment?s operating earnings were up 13% sequentially and 14% year-over-year to $237.3 million.
Revenue from the company?s eight-rig deepwater fleet was $208.2 million, which increased 7% sequentially.? Pride?s mid-water fleet, comprising six semi-submersible rigs, reported quarterly revenue of $80.9 million, up nearly 3% sequentially. The increase was driven by higher activity on the Pride South Seas, which spent considerable time during the first quarter in a shipyard. This fleet?s operating earnings were $20.2 million, down 28% sequentially.
Revenue from the company s 28-rig jack-up fleet was down 2% sequentially to $204 million, while operating earnings increased 5% sequentially to $85.9 million.
UBS Misses & Realigns
Top Swiss bank UBS (UBS) reported another large quarterly loss of $329 million in its 2nd quarter, marking the 4th consecutive loss for the beleagured firm, which is heavily exposed to the mortgage crisis.? The company noted further writedowns of $5.1 billion in the quarter, following $37.4 billion in writedowns from the 3 previous quarters.
The company's Zacks Rank #5 (Strong Sell) before the announcement already marks the lowest point on the Zacks Rank scale.? However, there was some additional news from UBS that investors on the Zurich Stock Exchange took as positive.? One, the firm is planning to separate its investment banking division from its wealth management group.? Two, UBS has announced a new CFO today.
