FBR calls Noble (NE) their favorite stock and an FBR Top Pick

CONTRIBUTOR http://notablecalls.blogspot.com

FBR calls Noble (NYSE: NE) their favorite stock and an FBR Top Pick. Firm believes that the stock has considerable upside potential, with very strong downside support. NE represents far and above the most attractive risk/return profile of any stock that they cover, with substantial upside potential and very strong downside protection trading just above firm's estimated liquidation value.

Based on Noble's March 8 fleet status report, they raised their 2008 EPS estimate to $13.90 from $13.65 on higher contract day rates and trimmed 2007 EPS estimate to $9.10 from $9.20 on downtime and contract slippage.

Noble continues to trade at an incredibly cheap valuation relative to firm's estimated liquidation value for the company. When they DCF its signed contracts and assume each rig is liquidated after each deal ends, they get an estimated liquidation value of $61.47 per share. By comparison, RIG is trading at 1.5x, DO at 1.8x, and GSF at 2.5x.

Maintains Outperform and $118 tgt.

Notablecalls: NE saw some buy interest on Fiday as there was some broker chatter saying the co had receieved a bid from SeaDrill.

For more calls go to http://notablecalls.blogspot.com

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