This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

GulfMark Offshore Unduly Punished

Every day in the stock market is a battleground. Battles within company management, between hedge funds and between analysts can violently swing stocks up and down independent of how the broader market trades.

For example, take GulfMark Offshore (GLF - Get Report), which provides offshore marine services to oil and natural gas companies. Following its strong earnings report on Wednesday, the company received both an analyst upgrade and downgrade.

On Thursday, Capital One Southcoast raised its price target on GulfMark to $63 from $62 a share but downgraded shares of the company from buy to hold.

Meanwhile, Jefferies raised its price target to $69 from $59 and increased its earnings-per-share outlook for the year to $5.87 from $4.86. Jefferies called the shares "undervalued," noting "continued strength in the global market and the massive demand growth potential in Brazil." It also cited "prospects for further improvements in day rates" as a catalyst to drive shares higher.

So who is right?

Looking back over the conference call, it seems as if Capital One raised several nonissues of concern about GulfMark's ability to get ships built and delivered in a timely manner.

This problem is not specific to GulfMark; it applies to the company's competitors, too. In fact, the lack of available ships gives GulfMark pricing power, which is the main driver for its current growth. Also, raising day rates by 60%-plus in Southeast Asia is more accretive to GulfMark's bottom line.

The Jefferies upgrade on GulfMark makes much more sense. Jefferies highlighted the main takeaway from GulfMark's first-quarter conference call: the potential growth in Brazil via contracts with Petrobras (PBR - Get Report). This growth has the potential to double earnings in the next few years.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
CKH $58.88 1.60%
GLF $7.23 8.10%
PBR $7.88 2.40%
SLB $80.66 1.10%
TDW $9.32 6.80%


Chart of I:DJI
DOW 17,777.48 -53.28 -0.30%
S&P 500 2,064.97 -10.84 -0.52%
NASDAQ 4,775.5350 -29.7560 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs