Offshore Driller Joins Ranks of Dividend Raisers

With great visibility into its cash flow generation opportunities in the future, Ensco (NYSE: ESV  ) decided it was time to raise its dividend. This confidence to generate cash flow is based partly around the company's record $11 billion backlog, and partly around its ever-increasing fleet size. Add to that several peer-leading liquidity and solvency metrics, and management decided it has the ability to reward shareholders with a 33% quarterly dividend hike. While its yield still falls short of Seadrill's (NYSE: SDRL  ) near 10% payout, Ensco is in a much better financial situation than its smaller peer. Check out what Ensco investor and Motley Fool analyst Taylor Muckerman has to say.

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  • Report this Comment On February 27, 2013, at 7:58 PM, EmFetch267 wrote:

    I have wanted to know for a long time when Transocean will raise its dividend again. Do you believe that now is the time to buy given that they have now worked out the settlement agreement for the Horizon incident?

  • Report this Comment On February 27, 2013, at 9:39 PM, TMFrunAMuck wrote:

    @EmFetch267 - Thanks for your comment.

    I think that the pressure is certainly on to raise the dividend after the move by Ensco. This adds to the pressure already placed on the offshore industry by Seadrills 9.8% yield (granted, I believe it is a bit overdone due to SDRL's reliance on debt to keep up with both CapEx and dividend pmnts).

    With regards to the Horizon incident, there could still be some fines handed out due to the hearing currently going on. However, I feel that BP is still in the most precarious place, followed by Transocean and then Halliburton.

    *Full disclosure - I own shares of ESV and HAL

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