NEW YORK (TheStreet) -- Shares of offshore drilling services company ENSCO (ESV) closed down 2.35% at $32 as crude oil prices slid Monday, the first day of trading after several OPEC members defended their refusal to take drastic action to prop up prices, the Wall Street Journal reports.
Oil officials from several leading members of the Organization of the Petroleum Exporting Countries on Sunday blamed producers outside of the group for the glut that has depressed prices, the Journal said.
On the New York Mercantile Exchange, West Texas Intermediate for February delivery slid 3.22% a barrel to $55.29 at 3:44 p.m. in New York. February Brent crude declined by 2.22% to $60.02.
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Despite the massive sell-off in shares, Jefferies does not yet believe it is time to be long the offshore drilling subsector, as neither fundamentals nor valuation paint a compelling enough picture of the group, they said.
Shares of London-based ENSCO traded on heavy volume with about 6.41 million shares changing hands by the market close in New York, compared to the average of 6.06 million. The stock is down over 44% year-to-date.
Separately, TheStreet Ratings team rates ENSCO PLC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate ENSCO PLC (ESV) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself."