Getting Back Into the Water

Getting Back Into the Water

I know the oil service sector has come a long way in the last few years and oil is at or below 70, but unless you feel there will be a world wide recession how can we pass up an industry with stocks trading at single digit multiples.

Transocean (RIG) and Noble (NE) both fit the bill with huge growth this year and next. RIG is expected to earn $11.41 next year. That is 43% growth on the bottom line from a 2007 number of $7.93. Even if I give that estimate a 20% haircut you still end up at 11x with 15% growth. This analysis is even more compelling for NE. Take a good look at these stocks if you aren't involved.