This Driller Stacks Up Nicely

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If this is what a trough quarter looks like, then Rowan Companies (NYSE: RDC) ought to have a bright future indeed.

The contract driller and manufacturer, which is quite levered to the shallow water drilling market, naturally had some less-than-stellar results to report for the period ended Sept. 30. In the drilling business, revenue dropped 28% from the prior year, margins eroded a touch, and income was cut in half.

How does that stack up to peers? Well, we saw Hercules Offshore's (Nasdaq: HERO) domestic offshore revenue plunge by 83%, contributing to a loss for the quarter. Pride International (NYSE: PDE) turned in a subpar performance of its own, with revenue off 17% and earnings from operations down 46%. Ensco International (NYSE: ESV) saw revenue drop more than 30% and per-share earnings nearly halved.

Hercules, working for relative table scraps for Gulf of Mexico operators like Chevron (NYSE: CVX) and Stone Energy (NYSE: SGY), is an easy mark, but the Pride and Ensco comparisons are rather interesting. Pride, with a fleet stuffed full of deepwater rigs, barely fared any better than Rowan. Ensco, which I've championed for a long time now, only ever-so-slightly bested Rowan's 59% offshore utilization.

So well done there, Rowan. I knew you had great depth. Whenever the market turns (recent increased bidding activity for premium jackups in the U.K. North Sea is a good start), you'll benefit handsomely. In the meantime, it's nice to see that Rowan can do better than just tread water.

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Fool contributor Toby Shute doesn't have a position in any company mentioned. Check out his CAPS profile or follow his articles using Twitter or RSS. The Motley Fool has a disclosure policy.

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Related Tickers

3/19/2010 4:00 PM
HERO $4.27 Down -0.12 -2.73%
Hercules Offshore,… CAPS Rating: ****
SGY $17.47 Down -0.20 -1.13%
Stone Energy Corp CAPS Rating: ****
CVX $74.98 Up +0.22 +0.29%
Chevron Corp CAPS Rating: ****
ESV $43.29 Down -1.74 -3.86%
ENSCO Internationa… CAPS Rating: *****
RDC $26.39 Down -0.66 -2.44%
Rowan Companies, I… CAPS Rating: ****
PDE $29.28 Down -0.28 -0.95%
Pride Internationa… CAPS Rating: ****

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