5-Star Stocks Poised to Pop: Transocean

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Based on the aggregated intelligence of 125,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, offshore driller Transocean (NYSE: RIG) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks woefully lag the market average.

With that in mind, let's take a closer look at Transocean's business, and see what CAPS investors are saying about the stock right now.

Transocean facts

Headquarters (founded)	Houston (1953)
Market Cap	$17.60 billion
Industry	Oil and Gas Drilling
TTM Revenue	$11.48 billion
Management	CEO Robert Long (since 2006) President/COO Steven Newman (since 2008)
Return on Equity (average, last three years)	28.3%
Competitors	Noble (NYSE: NE), Pride International (NYSE: PDE)
CAPS members bullish on RIG also bullish on:	Chesapeake Energy (NYSE: CHK), General Electric (NYSE: GE)
CAPS members bearish on RIG also bearish on:	General Motors (NYSE: GM), Citigroup (NYSE: C)

Sources: Capital IQ (a division of Standard & Poor's), and Motley Fool CAPS. TTM = trailing 12 months.

Over on CAPS, 902 of the 931 All-Star members who have rated Transocean -- or 97% -- believe the stock will outperform the S&P 500 going forward. These bulls include TSIF and rdpatton, who are ranked in the top 20% of our community.

Late last month, TSIF noted that with "it's P/E, backlog, top notch equipment, long term contracts, (worldwide), [Transocean] may suffer slightly from oil prices, but oil exploration/drilling/ is forward planned, several years out."

In a more recent pitch, rdpatton follows that bullish line of thinking, writing:

I think this will double in a years time. My assumption is that current oil fields will continue to deplete at a high rate thus driving the need to replace those reserves. I think off-shore drilling is the next lowest cost way to gain large oil reserves and thus [Transocean] and other off-shore drillers will continue to be in demand. Also, new builds will come on-line slower due to credit crunch and current low price of oil thus keeping day-rates high. Also this company has a large backlog which I do not believe will see any cancellations except for potentially a number of contracts held by companies that [file for bankruptcy protection].

What do you think about Transocean, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. CAPS is 100% free, so simply click here to get started. 

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