NEW YORK (AP) -- A J.P. Morgan Securities analyst upgraded Transocean Inc. and GlobalSantaFe Corp. on Wednesday, saying the combined oil services company will be shielded somewhat from the global jackup rig market and it can pay off debt.
J.P. Morgan Securities analyst David Smith upgraded Transocean and GlobalSantaFe to "Neutral" from "Underweight." This is in contrast to several analysts who in the past week have cut earnings estimates or downgraded the companies.
The two companies, which have agreed to a $53 billion combination, lease to oil companies ships that help drill for oil underwater.
The deal will shield the companies' exposure to the jackup rig market, or operation of ships that float and send down legs to drill for oil on the seafloor.
Prices for jackup rigs are slipping, he said. Strength in the markets for ships that go underwater to seek oil will offset weakness in the jackup market, he said.
Wednesday, September 12, 2007
JP Morgan Upgrades Transocean
Ahead of the Bell: RIG, GlobalSantaFe