What: Shares of oil driller Diamond Offshore Drilling Inc (NYSE: DO ) jumped as much as 10.6% today after releasing earnings.
So what: first quarter revenue fell 3% to $709.4 million but came in ahead of the $686.3 million estimate from analysts. Net income also dropped 17% to $145.8 million but adjusted earnings per share of $0.93 easily topped the $0.65 estimate.
Now what: Expectations for early 2014 are low across the industry but we're seeing high utilization and dayrates in jack-ups, which is helping results. The ultra-deepwater segment, which has driven the industry's growth recently, was slow and utilization was down to 66% last quarter. I think the numbers are good, and with a $0.75 special dividend on top of the $0.125 quarterly dividend, shares have room to run as the overall drilling market improves this year.
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