If you've read my coverage of the offshore drillers, you know I like Noble
The shortest answer may be that the world still needs oil -- and lots of it. But that's not a remotely satisfactory explanation. There are plenty of oil stocks I wouldn't touch with a 200-foot derrick. There's more to the Noble story than peak oil platitudes and "drill, baby, drill."
The main point here is Noble's quite reliable revenue. Whereas a landlubber like Patterson-UTI
Granted, the mature Gulf of Mexico can be a harsh mistress for firms like Hercules Offshore
As these rigs roll over to new contracts, leading-edge dayrates very well may ease from here, but they're not going to play dead. This quarter, jackup rates only lifted 19% compared to the prior year, so there's arguably a lot less air in these rates than there was in the oil price itself.
Getting back to the company's cash stream, I want to point out that Noble, like Ensco International
Lately, Noble has traded down to a price that seems to suggest the bottom is falling out. Given the contract backlog (particularly the Petrobras