UPDATE: Wunderlich Securities Initiates Coverage on ENSCO PLC with Hold Rating, $64 PT Awaiting More Attractive Opportunities

In a report published Wednesday, Wunderlich Securities analyst Todd P. Scholl initiated coverage on ENSCO PLC ESV with a Hold rating and $64.00 price target. In the report, Wunderlich Securities noted, “We are initiating coverage of Ensco plc (ESV) with a Hold rating and a price target of $64, representing a 6.1x 2015 EV/EBITDA multiple. We believe consensus estimates for 2014 and 2015 are too high and will likely be reduced as the result of downtime additions and lower-than-estimated dayrate revisions as contracts roll, particularly relating to the 8500 series semi-submersibles. Additionally, we believe contract rolls for its older drillships could disappoint and put pressure on the stock although these actual contracts will not impact 2014 and 2015 results. Over its history Ensco has done an impressive job at maximizing its margins and we would be a buyer at lower levels but currently we believe more attractive opportunities exist elsewhere in the offshore drilling space.” ENSCO PLC closed on Tuesday at $54.47.