Wells Fargo Upgrades Oceaneering Intl (OII) to Outperform; Time To Reboard This Yellow ROV

Wells Fargo upgraded Oceaneering Intl (NYSE: OII) from Market Perform to Outperform. Valuatino range increased from $76-80 to $96-100.

Wells analyst says, "OII's risk-reward is currently in equilibrium, in our view. GoM activity should recover in line with the high end of OII's expectations. Globally, the floater fleet should significantly expand and shift towards a more equal balance between exploration and development. Both factors should fuel ROVs and Subsea Products growth. Finally, OII should use its ample fire power continue to return cash, most likely via share repurchases, and make accretive, if likely tiny, acquisitons."

"Raising EBITDA/EPS for 2011E from $451MM/$3.65 to $453MM/$3.85; and 2012E from $560MM/$4.70 to $567MM/$5.00 on (1) OII's expected, effective tax rate reduction from 34.5% to 31.5% (EPS impact: +$0.17 in 2011, +$0.21 in 2012) and (2) modestly stronger Subsea Products partly offset by weaker Subsea Projects (+$0.03 and +$0.09)."

For more ratings news on Oceaneering Intl click here and for the rating history of Oceaneering Intl click here.

Shares of Oceaneering Intl closed at $80.14 yesterday.

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