We've seen a lot of ho-hum reports out of the energy space thus far this quarter. National Oilwell Varco
A big difference between NOV and contract drillers like Ensco International
In a quarter like this one, where the rig count in certain regions -- cough, Canada, cough -- comes in softer than the ground during a spring thaw, that balanced revenue stream comes in handy. Not that PS&S was a slouch by any means -- it turned in higher sequential revenue and operating profit. Still, Rig Technology was the star of the show, pulling down 67% higher revenue on near-record order levels.
So did NOV just hit a cyclical peak? I'm not so sure. On the call, management definitively stated that "backlog will grow next quarter." Not should grow, but will grow. Clues to understanding this confidence came during a discussion of the mismatch between offshore rig announcements and deals actually booked. In essence, the company knows what's getting built, even if it can't include those rigs in its official count of contracts awarded. Given that we're approaching the slow month of August, I think this guidance says a lot about the global offshore market's continued strength.