Fact based stock research
Transocean (NYSE:RIG)

CH0048265513

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Transocean stock research in summary

deepwater.com

ANALYSIS: With an Obermatt Combined Rank of 4 (worse than 96% compared with investment alternatives), Transocean (Oil & Gas Drilling, Switzerland) shares have lower financial characteristics compared with similar stocks. Shares of Transocean are low in value (priced high) with a consolidated Value Rank of 28 (worse than 72% of alternatives), show below-average growth (Growth Rank of 38), and are riskily financed (Safety Rank of 17), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 4, is a sell recommendation based on Transocean's financial characteristics. As the company Transocean's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 28), low growth (Obermatt Growth Rank of 38), and risky financing practices (Obermatt Safety Rank of 17), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	28
Growth Rank	38
Safety Rank	17
Combined Rank	4

Country	Switzerland
Industry	Oil & Gas Drilling
Index
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Transocean

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	38	47	17	28
GROWTH
GROWTH	35	7	59	38
SAFETY
SAFETY	36	84	18	17
SENTIMENT
SENTIMENT	n/a	25	5	^new
360° VIEW
360° VIEW	n/a	33	1	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Transocean is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	38	47	17	28
GROWTH
GROWTH	35	7	59	38
SAFETY
SAFETY	36	84	18	17
COMBINED
COMBINED	22	45	8	4

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Transocean the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 28 (worse than 72% compared with alternatives), Transocean shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for Transocean. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 91, which means that the stock price is lower compared with invested capital than for 91% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 41 which means the stock price compared with what market professionals expect for future profits is higher than 59% of comparable companies, indicating a low value concerning Transocean's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 91 and for the dividend yields rank which is lower than for 99% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 28, is a hold recommendation based on Transocean's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Transocean, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	49	50	26	41
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	21	n/a	1	1
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	87	97	91	91
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	38	47	17	28

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Transocean; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 38 (better than 38% compared with alternatives), Transocean shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Transocean. Sales Growth has a rank of 74, which means that, currently, professionals expect the company to grow more than 74% of its competitors. Profit Growth with a rank of 74 is also above average. But Capital Growth has only a rank of 6, and Stock Returns with 20 are also below-average. Stock returns for Transocean have recently been below 80% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 38, is a hold recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Transocean. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with the Obermatt Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	24	10	90	74
PROFIT GROWTH
PROFIT GROWTH	58	37	33	74
CAPITAL GROWTH
CAPITAL GROWTH	n/a	6	13	6
STOCK RETURNS
STOCK RETURNS	96	43	83	20
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	35	7	59	38

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Transocean.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 17 (better than 17% compared with alternatives), the company Transocean has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Transocean is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Transocean and the other two below average. Refinancing is at 53, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 53% of its competitors. But Leverage is high with a rank of 26, meaning the company has an above-average debt-to-equity ratio. It has more debt than 74% of its competitors. Liquidity is also on the riskier side with a rank of 8, meaning the company generates less profit to service its debt than 92% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 17 (worse than 83% compared with alternatives), Transocean has a financing structure that is significantly riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Transocean are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. In the long-term, investors may have a debt challenge with Transocean and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	8	60	36	26
REFINANCING
REFINANCING	77	100	43	53
LIQUIDITY
LIQUIDITY	54	39	8	8
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	36	84	18	17

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Transocean and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	12	14	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	91	44	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	48	20	^new
MARKET PULSE
MARKET PULSE	n/a	1	6	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	25	5	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Transocean.
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