At 24% of our FY13 forecast, 1Q13 results were actually above
expectations, as stronger quarters are anticipated with five more
liftboats/service rigs to be added through the year to its current 12.
Catalysts could come from stronger-than-expected orders.
1Q core EPS was 20% above our
expectation (11% above consensus)
from higher gross margins and other
income. We increase our FY13-15 core
EPS by 3-8% to incorporate recent
service-rig contracts, the divestment
of its OMSA JV, contributions from
marine supply bases and higher EBIT
margins. Maintain Outperform with a
higher target price following our EPS
upgrade, still based on blended P/E
and P/BV valuations.
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