JPMorgan Downgrades Diamond Offshore (DO) to Underweight

JPMorgan analyst Sean Meakim downgraded Diamond Offshore (NYSE: DO) from Neutral to Underweight with a price target of $14.00 (from $12.00).

The analyst sees fleet optionality weakening. He comments "Given DO’s more independent fleet strategy, long-term competitiveness will be more contingent upon the efficacy of organic growth levers across its semi fleet (with elevated capital needs potentially challenging returns) and unproven value propositions (e.g. floating factory newbuild program) rather than M&A/scale advantages. Our updated rig-level DCF valuation implies ~27% downside to current price levels so we consequently downgrade the shares to Underweight."

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

Shares of Diamond Offshore closed at $19.16 yesterday.

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