UPDATE: ISI Group Upgrades Transocean to Strong Buy on Significant Upside

In a report published Monday, ISI Group analyst Judson E. Bailey upgraded the rating on Transocean Ltd. RIG from Buy to Strong Buy, and raised the price target from $60.00 to $66.00. In the report, Bailey noted, “Although most of the debate around RIG seems to be whether shareholders will vote for a $4 or $2.24 dividend this year, we believe many investors are missing the bigger picture for RIG and the potential upside in the name. In our view, whether Icahn's proposals go through or not (although we tend to think they will), we believe the combination of cost cutting, better capital discipline, and a long-term dividend policy provides significant upside to the shares. As such, we are upgrading RIG to Strong Buy from Buy and increasing our 12-month PT to $66 from $60, which is based on 100% of NAV and 6x 2014 TEV/EBITDA (pro forma for potential cost savings).” Transocean Ltd. closed on Friday at $53.24.