Oil drilling equipment maker
Cameron International Corp.
) has reported an update to the Drillship Package contract
received from South Korea-based STX Offshore & Shipbuilding
Co. Ltd. on Nov 26, 2012.
Per the 2012 deal, Cameron was to provide an entire drilling
equipment package to be used for the construction of the 12,000
foot ultra deepwater drillship. The drillship is being
constructed by STX Offshore for Norway-based Sigma Drilling Ltd.
a part of
Vantage Drilling Company
). However, owing to ongoing restructuring process, the South
Korean shipbuilder has temporarily stopped manufacturing of the
Vantage along with Sigma Drilling is in talks with STX Offshore
to resume work on the construction. As of now, work on the
drillship is expected to be completed by the first or second
quarter of 2016.
Houston, Texas-based Cameron is a manufacturer of pressure
control equipment used in onshore, offshore and subsea
applications for oil and gas drilling, production and
Cameron has lost its leading market position as a supplier of
subsea production systems (Christmas trees) to competitors in the
last few years. While new order bookings are projected to improve
the company's market share, we do not expect it to regain its
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Cameron currently retains a Zacks Rank #5 (Sell), implying that
it is expected to significantly underperform the broader U.S.
equity market over the next one to three months.
Meanwhile, one can look at better-performing oil field machinery
and equipment suppliers like
Profire Energy Inc.
) that offer value. Both, Dril-Quip and Profire Energy carry a
Zacks Rank #1 (Strong Buy).