Ocean Rig UDW Inc Stock Upgraded (ORIG)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

NEW YORK ( TheStreet) -- Ocean Rig UDW (Nasdaq: ORIG) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

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Highlights from the ratings report include:
  • ORIG's very impressive revenue growth greatly exceeded the industry average of 20.6%. Since the same quarter one year prior, revenues leaped by 69.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • OCEAN RIG UDW INC reported significant earnings per share improvement 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 year. We feel that this trend should continue. During the past fiscal year, OCEAN RIG UDW INC turned its bottom line around by earning $0.48 versus -$1.00 in the prior year. This year, the market expects an improvement in earnings ($1.81 versus $0.48).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 79.6% when compared to the same quarter one year prior, rising from $38.76 million to $69.59 million.
  • The gross profit margin for OCEAN RIG UDW INC is rather high; currently it is at 58.52%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 15.76% is above that of the industry average.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Energy Equipment & Services industry and the overall market, OCEAN RIG UDW INC's return on equity significantly trails that of both the industry average and the S&P 500.

Ocean Rig UDW Inc., an offshore drilling contractor, through its subsidiaries, provides oilfield services for offshore oil and gas exploration, development, and production drilling. It specializes in the ultra-deepwater and harsh-environment segment of the offshore drilling industry. Ocean Rig UDW has a market cap of $2.27 billion and is part of the basic materials sector and energy industry. Shares are down 9.1% year to date as of the close of trading on Friday.

You can view the full Ocean Rig UDW Ratings Report or get investment ideas from our investment research center.

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