Player Avatar dockofthebay (98.49) Submitted: 10/4/2012 9:02:46 PM : Outperform Start Price: $45.90 ATW Score: +2.02

There is plenty of risk involved in ordering the construction of drilling rigs, whether jackups or deep water rigs, without contracts from oil exploration and production companies in hand before shipyard work begins. Still, management of Atwood seems to be savvy in knowing what and when to build. Oil prices are a key catalyst. Right now, oil prices are relatively tame. A plunge in oil prices would hurt Atwood and a rise in oil prices would give the company a boost in that they could charge higher day rates in new and renewed contracts.

As long as they keep expanding their rig count cautiously (especially the deep water rigs) and oil prices don't plunge much lower, I'm a buyer at this level. Disclosure: I own a small number of shares in real life.

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