UPDATE: Wunderlich Initiates Coverage on Atwood Oceanics on Fair Valuation

In a report published Wednesday, Wunderlich Securities analyst Todd P. Scholl initiated coverage on

with a Hold rating and $63.00 price target. In the report, Wunderlich Securities noted, “We are initiating coverage of Atwood Oceanics, Inc. (ATW) with a Hold rating and a price target of $63, representing a 6.0x 2015 EV/EBITDA multiple. We believe current consensus estimates for 2014 and 2015 are too high and will likely be reduced as the result of downtime additions and higher-than-estimated cost revisions. Under its current management team, Atwood has done an excellent job transforming the company into a more global offshore driller and has expanded its operations to the ultra deepwater. This transformation and Atwood's excellent execution have led to strong outperformance over the last 12 months which, in our view, has left its valuation stretched. Therefore, we believe other, more attractive opportunities exist elsewhere in the offshore drilling space.” Atwood Oceanics closed on Tuesday at $55.11.