Diamond Offshore's (DO) Q3 Earnings Beat, Revenues Miss

Diamond Offshore’s (DO) Q3 Earnings Beat, Revenues Miss

Diamond Offshore Drilling Inc. DO reported third-quarter 2016 adjusted earnings of 10 cents per share that comfortably surpassed the Zacks Consensus Estimate of 7 cents. The bottom line, however, decreased from the year-earlier earnings of $1.01 per share.

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Total revenue in the quarter of $349.2 million decreased from the year-ago figure of $388.7 million and also came in below the Zacks Consensus Estimate of $361.51 million.Operational PerformanceIn the third quarter, revenues from the Contract Drilling segment plunged 43.3% year over year to approximately $339.6 million.Ultra-Deepwater floaters recorded an average dayrate of $452,000 during the quarter as against $479,000 in the year-earlier quarter. Deepwater floaters realized an average dayrate of $303,000 compared with $361,000 in the year-ago quarter. Mid-water floaters recorded an average dayrate of $311,000 as against $289,000 in the prior-year quarter.Rig utilization for Ultra-Deepwater floaters decreased to 48% from 71% in the year-ago quarter. Utilization of Deepwater floaters fell to 34% from 59% a year ago. Mid-water category rig utilization was 33% as against 31% in the comparable quarter last year.FinancialsAs of Sep 30, 2016, Diamond Offshore had approximately $81.3 million in cash and cash equivalents, while long-term debt totaled $1,980.6 million.Zacks Rank and Stocks to ConsiderDiamond Offshore currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy sector are Enbridge Energy Partners, LP EEP, Braskem SA BAK and EQT Midstream Partners EQM. Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Enbridge Energy Partners has an impressive earnings surprise history. The partnership posted positive earnings surprise in three of the last four quarters. It reported a positive earnings surprise of 69.23% in the preceding quarter. Braskem SA posted a positive earnings surprise of 105.45% in the year-ago quarter.In the last reported quarter, EQT Midstream Partners delivered a positive earnings surprise of 6.72%. Coming to the earnings surprise history, the partnership beat estimates in three of the last four quarters.Confidential from ZacksBeyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>

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