JP Morgan Lowers PT on Rowan Companies to $46
JP Morgan has published a research report on Rowan Companies (NYSE: RDC) after the company released its most recent fleet status report, and has lowered the price target from $48 to $46.
In the report, JP Morgan writes, "We have updated our Rowan (RDC) model to reflect the most recent fleet status report, which included some shifting around of contract start/end dates, 23 incremental downdays for 4Q11, and updated dayrates for some Saudi Aramco contracts in which rigs had arrived late and thus are subject to penalties of up to half of the dayrate for each late day, which is recognized ratably over the remaining contract period. As a result, we're lowering our 4Q11 EPS by $0.07, or 14%, and our 2012/2013 EPS by $0.05/$0.15, or 1%/3%. RDC is filing a formal appeal to Aramco to reverse the late penalties, which could provide upside to current estimates."
JP Morgan maintains its Overweight rating on Rowan Companies, which is currently trading down $0.45 from yesterday's $31.02 closing price.
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