NEW YORK (TheStreet) -- Diamond Offshore Drilling
(DO - Get Report) shares are falling -5.7% to $47.13 on Thursday due to the company's weak offshore drilling prospects despite beating analysts second quarter earnings and revenue expectations
The company reported profits of 65 cents per share, 9 cents better than analysts had anticipated, on revenue of $692 million, $8 million better than analyst estimates.
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However, the company's fleet status report, released yesterday, showed that day rates for ultra deep offshore drilling is trending down.
Analysts at Cowen (COWN - Get Report) said, "The 485k/d rate represents the step down from recent 3-year contracts in the $550-$600 range. While the rate is above initial speculation of a flat $400k/d rate and our estimate of $450k/d, we think it will be perceived negatively as it serves as a reminder that the trend in ultra-deepwater dayrates remains firmly down."
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