What happened

Shares of Atwood Oceanics (NYSE:ATW) are bounding higher on Wednesday and were up more than 13% by 3:00 p.m. EDT. There wasn't any news to drive the stock higher today. Instead, it appears that investors finally decided they like the company's messy fiscal second-quarter report.

So what

Atwood Oceanics reported a mixed quarter on Monday night because of several one-time items. On the positive side, the company benefited from a one-time $48.1 million payment after a client chose to revert a contract back to the original term. Further, it recorded an $8.4 million gain on the extinguishment of debt. That said, the company also took a $59 million impairment charge after it wrote down a rig to its salvage value and subsequently sold that vessel for recycling.

Offshore rig at sunset.

Image source: Getty Images.

While that report was neutral at best, there were a few things CEO Robert Saltiel said on the subsequent conference call worth noting. First, he pointed out that one of its clients, Kosmos Energy (NYSE:KOS), just made another offshore gas discovery in Senegal. Because of Kosmos Energy's success, Atwood was in discussions to extend its current contract. Meanwhile, Saltiel noted that Atwood was working on several opportunities for new rig contracts, and he was "hopeful" that the company would win some of these deals. That optimism appears to be one of the fuels of today's rally.

It also doesn't hurt that crude oil rallied sharply today, rising more than 3% for its biggest gain since last November. Fueling crude's rally was an unexpectedly large drop in U.S. oil inventories. That data might help convince OPEC to extend its output cuts into the second half of this year.

Now what

Atwood Oceanics continues to work hard to land more work for its fleet, and it is growing more optimistic that it will win some awards soon. Those contracts would certainly give it a bit more breathing room. Meanwhile, the higher oil prices move, the more opportunities it will have to win additional work in the future, which would go a long way toward easing investors' fears about its long-term stability.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.