Hercules Offshore Shares Fall 33%
Drilling contractor Hercules Offshore Inc's shares fell as much as 33 percent to a record low on Friday, a day after Deutsche Bank cut its price target on the company's stock to $0.
State-owned oil company Saudi Aramco terminated its contract for one of Hercules Offshore rigs on Thursday, prompting the brokerage to downgrade the stock to 'sell' from 'buy'.
Rig operators are struggling to find work as oil producers scale back spending and drilling activity in response to a near 50 percent fall in crude prices since June.
"With demand nearly non-existent and a steady stream of new capacity entering the market, the prospect for recovery in the short to intermediate term is bleak," Deutsche Bank analysts wrote in a note to its clients.
The company is valued at $78.8 million at the stock's life low of 49 cents, according to Thomson Reuters data.
The median price target on the stock is 75 cents, down 20 cents from 30 days ago. Macquarie Research and Evercore ISI have a price target of 50 cents.
Only 4 of the 17 brokerages covering the stock rate it 'buy', while eight rate it 'hold' and five recommend 'sell'.
Up to Thursday's close, stock had fallen nearly 85 percent in 12 months.
The company reported a smaller-than-expected quarterly loss in the fourth quarter as it kept a tight leash on costs to counter a fall in demand.
(Reporting by Anannya Pramanick in Bengaluru; Editing by Don Sebastian)
