- Transocean (RIG +4.6%) enjoys strong gains after Susquehanna upgrades shares to Positive from Neutral with a $16 price target, while the firm downgrades Oasis Petroleum (OAS +0.8%) to Neutral from Positive with a $14 price target.
- "Offshore floater contracting activity has begun to rebound, and we believe more positive commentary across several of the companies suggests the industry is beginning to heal, and better utilization could be ahead in 2019 and 2020," Susquehanna says in raising its rating on RIG for more leverage to the sector.
- The firm thinks OAS shares, however, are fully valued after rising 55% YTD while the SPDR S&P Oil and Gas Exploration and Production ETF (NYSEARCA:XOP) is just 18% higher.
- Investors who want exposure to companies with substantial non-Permian production should instead buy Marathon Oil (MRO +3.3%), which the firm rates Positive with a $26 price target, improved from $24.
- Now read: Marathon Oil Is Bakken Into Oil Profits
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