NEW YORK (TheStreet) -- Shares of Oceaneering International (OII) are up 2.44% to $75.59 on Thursday, after the deep water oil and gas company announced higher first quarter 2014 earnings and revenues that beat its own expectations.
"We are off to a good start to the year as our record first quarter EPS was above our guidance," said CEO M. Kevin McEvoy.
For the first quarter 2014, Oceaneering International generated net income of $91.2 million or $0.84 per share, on revenue of $840.2 million.
During the same quarter for 2013, the company reported a net income of $74.8 million or $0.69 per share, on revenue of $718.9 million.
Year over year quarterly earnings per share increased 22% on profit improvements by all oilfield business operations, the company said.
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TheStreet Ratings team rates OCEANEERING INTERNATIONAL as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate OCEANEERING INTERNATIONAL (OII) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, solid stock price performance and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- OII's revenue growth has slightly outpaced the industry average of 8.3%. Since the same quarter one year prior, revenues rose by 14.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- OII has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.18, which illustrates the ability to avoid short-term cash problems.
- OCEANEERING INTERNATIONAL has improved earnings per share by 16.2% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, OCEANEERING INTERNATIONAL increased its bottom line by earning $3.42 versus $2.66 in the prior year. This year, the market expects an improvement in earnings ($4.05 versus $3.42).
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- Net operating cash flow has increased to $163.95 million or 10.45% when compared to the same quarter last year. Despite an increase in cash flow, OCEANEERING INTERNATIONAL's cash flow growth rate is still lower than the industry average growth rate of 23.52%.
- You can view the full analysis from the report here: OII Ratings Report