Wednesday, 24 February 2016 00:00

Why I Remain Bearish On Atwood Oceanics

If offshore drilling industry conditions would have been robust, Atwood Oceanics (NYSE: ATW) would have been among my favourite stock picks considering the company‚Äôs high-specification fleet with an average age of just 4.5 years. However, in challenging times for the industry, a good company might not be a good investment and this article discusses the reasons to remain bearish on…
The depression in oil prices over the last 18+ months has translated into broad based carnage for the offshore drilling sector. The biggest names have not been spared and the outlook still remains challenging for the industry. However, there are quality names in the industry that are not significantly leveraged and have robust backlog to navigate the crisis. While I…
Monday, 22 February 2016 00:00

The Johan Sverdrup Cash Machine Analysis

The oil & gas industry has witnessed a major carnage in the last 18+ months and industry sentiments are significantly bearish. With prolonged depression in oil prices, there will be countries that enter into recession and companies that go bust. At the same time, there will be companies with sound fundamentals and game changing assets that are worth considering from…
The year 2015 was the strongest for crude tanker rates in the last seven years. One of the biggest factor that drove spot tankers rates higher was low oil prices. As countries looked to capitalize on low oil prices through storage of strategic crude reserves, the demand for oil tankers surged and so did the spot market rates. Clearly, the…
There are several sub-sectors within the broad energy sector that have been impacted due to the crash in oil prices. Among the worst hit is the offshore drilling sector where companies had leveraged significantly during good times. This article discusses the order backlog (2016) for key offshore drilling companies, the EBITDA outlook for 2016 and the leverage outlook. The objective…
The offshore drilling sector has been hit hard due to steep decline in oil prices and several companies have witnessed deep carnage. Just as an example, Seadrill (NYSE:SDRL) has crashed by 86% in the last one year. While 2016 is likely to be another challenging year for the offshore drilling industry, there are quality names in the industry that can…
Thursday, 18 February 2016 00:00

Credit Metrics Analysis For AerCap Holdings

On February 14, 2016, I had provided a basic credit metric analysis for Air Lease (NYSE: AL), a company operating in the aircraft leasing industry. This article looks the credit metrics for another company (largest by market capitalization) in the aircraft leasing industry. AerCap Holdings (NYSE: AER) had 1,124 owned aircraft as of September 30, 2015 with an average aircraft…
Air Lease (NYSE:AL) is in the business of aircraft leasing and the stock has slumped by 27.4% for YTD16. In my view, this correction is a good opportunity to consider long-term exposure to the stock and this article discusses the company from a credit perspective.     A discussion from credit perspective is important as aircraft leasing stocks have high…
Is the IPO volume in the United States another indicator of stock market peak? The chart gives the IPO volume on a yearly basis from 2004 to end of 2013.     What is worth noticing here is the fact that the issuance of new paper peaked out in 2007 at $48.4 billion. In 2013, the IPO issuance volume surpassed…
From a crisis low of 666 on the S&P, the market has surged by 182% over the last five years to current levels of 1,878. What has also surged to a record high in January 2014 is the margin debt, which hit an all time high of $451 billion on the New York Stock Exchange.     A high margin…
Page 4 of 5