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FBR Capital Maintains an 'Outperform' on Rowan (RDC); Delivers on LeTourneau Monetization, Land Drilling Still Slated for 2011

May 16, 2011 3:27 PM EDT
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Price: $10.93 --0%

Rating Summary:
    16 Buy, 18 Hold, 3 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
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FBR Capital maintains an 'Outperform' on Rowan Companies (NYSE: RDC), PT $50.

FBR analyst says, "We were a bit surprised by an outright sale given management's comments on its 1Q11 earnings call that it planned to file spin-off documents with the SEC within 10 days. However, we view the valuation of $8.65 per share as highly attractive, and the outright sale speeds up the monetization process for Rowan. We leave our estimates unchanged until the transaction closes. While the divestiture of LeTourneau has been the longawaited milestone for Rowan, we see future catalysts in the sale of the company's land rig fleet this year, contracting opportunities in the Middle East, as well as announcements on the newbuilding front. In addition, we expect investors to become more excited about a purer-play company that could be a takeout candidate for another driller looking to add premium assets."

For more ratings news on Rowan Companies click here and for the rating history of Rowan Companies click here.

Shares of Rowan Companies closed at $38.04 yesterday.


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