Wells Fargo Downgrades Hercules Offshore (HERO) to Market Perform

January 24, 2014 8:16 AM EST
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Price: $1.22 --0%

Rating Summary:
    5 Buy, 14 Hold, 5 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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Wells Fargo downgraded Hercules Offshore (NASDAQ: HERO) from Outperform to Market Perform with a price target of $5-$6 (from $8-$9).

Analyst Matthew D. Conlan said, "We are not making any changes to estimates for HERO in this note, as HERO does not own any floaters, but we are lowering our valuation range and downgrading the stock to Market Perform from Outperform. We and the market were definitely spooked by HERO’s decision to abort the planned reactivation of a GOM jackup (as announced Wednesday night), showing management's concern about the strength and depth of HERO's most important cash-flow generating market. With this sudden market warning, especially considering the age of HERO’s fleet, we have substantially reduced our target EBITDA multiple, down to just 3.5x from approximately 5.5x, lowering our valuation range to $5-$6/share from $8-$9/share."

For an analyst ratings summary and ratings history on Hercules Offshore click here. For more ratings news on Hercules Offshore click here.

Shares of Hercules Offshore closed at $4.88 yesterday.

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