Transocean Ltd. (NYSE:RIG) is an interesting stock at present. Now trading with a market value of 3.42B, the company has a mix of catalysts and obstacles that spring from the nature of its operations. In light of the many issues surrounding this company, we thought it was a good time to take a close look at the numbers in order to form a realistic perspective on the fundamental picture for this stock.
Transocean Ltd. (NYSE:RIG) Fundamentals That Matter
It’s generally a good idea to start with the most fundamental piece of the picture: the balance sheet. The balance sheet health of any company plays a key role in its ability to meet its obligations and maintain the faith of its investment base. For RIG, the company currently has 3.54 billion of cash on the books, which is offset by 1.46 billion in current liabilities. The trend over time is important to note. In this case, the company’s debt has been falling. The company also has 26.72 billion in total assets, balanced by 10.78 billion in total liabilities, which should give you a sense of the viability of the company under any number of imagined business contexts.
Transocean Ltd. (RIG) saw 62 million in free cash flow last quarter, representing a quarterly net change in cash of 41 million. Perhaps most importantly where cash movements are concerned, the company saw about 184 million in net operating cash flow.
Transocean Ltd. (NYSE:RIG) Revenue Growth Potential
As far as key trends that demonstrate something of the future investment potential of this stock, we need to take a closer look at the top line, first and foremost. Last quarter, the company saw 785 million in total revenues. That represents a quarterly year/year change in revenues of -0.41 in sequential terms, the RIG saw sales decline by -0.19.
But what about the bottom line? After all, that’s what really matters in the end. Transocean Ltd. (RIG) is intriguing when broken down to its core data. The cost of selling goods last quarter was 575 million, yielding a gross basic income of 210 million. For shareholders, given the total diluted outstanding shares of 390 million, this means overall earnings per share of 0.23. Note, this compares with a consensus analyst forecast of -0.11 in earnings per share for its next fiscal quarterly report.
Is Transocean Ltd. (NYSE:RIG) Valuation Attractive
Looking ahead at valuations, according to the consensus, the next fiscal year is forecast to bring about -1.04 in total earnings per share. If we consider a median price to earnings ratio on the stock, that corresponds with a stock price of 9,999. However, one should always remember: the trends are more important than the forecasts. This continues to be an interesting story, and we look forward to updating it again soon on Transocean Ltd..