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Transocean Ltd (RIG) has seen its shares rise by 21% over the past three months, outperforming the Zacks Oil & Gas-Drilling sub-industry growth of 18.9% and the broader Oil & Energy sector, which saw a 5.9% increase. As of June 30, 2025, the company holds a backlog of approximately $7 billion, providing significant revenue visibility.
However, the Zacks Consensus Estimate for RIG’s earnings per share has remained unchanged for fiscal 2025, while it was revised downward by 11.76% for fiscal 2026, indicating potential long-term uncertainties. Additionally, current contracting activity has slowed, leading to a decrease in day rates, which are expected to moderate from the mid-to-high $400,000s to the low $400,000s.
Transocean aims to reduce debt by over $700 million in 2025, as its long-term debt stands at $5.9 billion with a forecasted net cash interest expense of $540 million to $545 million for the full year. While management’s focus on cost management and revenue stability is evident, the company’s dependence on specific regions for future demand poses additional risks.
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