Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, contract driller Diamond Offshore Drilling (NYS: DO) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Diamond Offshore's business and see what CAPS investors are saying about the stock right now.
Diamond Offshore facts
Oil and gas drilling
CEO Lawrence Dickerson (since 2008)
CFO Gary Krenek (since 1998)
Return on Equity (Average, Past 3 Years)
$981.1 million / $1.5 billion
Noble (NYS: NE)
Transocean (NYS: RIG)
Ensco (NYS: ESV)
Sources: S&P Capital IQ and Motley Fool CAPS.
This past summer, ipsiety listed several of Diamond Offshore's positives: "Good balance sheet. Has tremendous growth opportunity. Is at a discount in terms of P/E and PS."
Diamond Offshore even sports a cheapish price-to-cash flow of 6.2. That represents a discount to industry peers like Noble (8.8), Transocean (7.0), and Ensco (10.3).
CAPS member Wyatt2luv elaborates on the bargain opportunity:
Current Wall Street estimates are simply too pessimistic, DO earnings power can reach $12 per share in 2013 with the addition of the 3 newbuild 12,000 ultradeepwater drillships and two other newly built drillers that started working in 2010 bought at distressed prices in 2009. That means DO added 5 of the highest end drillips since 2009. DO earned close to $9.80 per share in 2009. ... 2010 was the year of the Macondo disaster which led to DO moving rigs outside of GOM and incurring a lot of costs along the way which depressed margins and earnings.
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Interested in another easy way to trackDiamond Offshore?Add it to your watchlist.
At the time thisarticle was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Noble, Ensco, and Transocean. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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