Rowan Companies, Inc. (RDC)

Rowan is a deep water oil driler . Low debt . Good balance sheet. One of the most beat up stock on the market. The oil sector is going to grow bigger in 5 to 100 year! The intrinsic value of this stock is 68.57 using disocunt cash flow. The margin of saftey margin of saftey is aroound 71 percent. Sell in five years at the intristic value or sooner make 36 % or more compound a year. No brainer !

Gold climbs, domestic oil needs increase, demand for wood stays even (maybe slightly increased) and who benefits ? The companies that provide the infrastucture and the support for the miners and harvesters of this world.

Graham Value pick, @ $26/share, P/E=7.20, P/B =1.0; P/E*P/B= 7.20; Current Ratio = 2.30; LT Debt to Owner's Equity = 0.11. $25/share is arbitrary (6% below price on 11-9-2009).

Here I go again!
Another of those "personalized" suggestions.
It does look like a good investment.

Besides being a contract driller, Rowan manufactures equipment. The latter pushed me into its arms as an invester. It has the advantage of manufacturing for three industries that are going to need its products... desperately. Drilling rigs, mining equipment and timber harvesters. I call that a sweet spot. Bring it!

Me, buying cheap stocks only

Rowan companies is an international oil driller that is selling for less than book value despite being financially sound and profitable. Caps rating 5, stock scouter 9.

Contract drilling services will only increase as oil demand picks back up world wide and Rowan has good margins and competent management to take advantage of further opportunities in the sector.

Is WallStreet full of it or are these really some of the Fastest-Growing Stocks in S&P 500 Index

I am betting on oil/energy right now.

Trading well below book value. Decent financials. May be early for a rebound in the oil patch, but it will happen eventually.

http://seekingalpha.com/article/132892-interview-with-matt-badiali-time-to-buy-oil-service-companies

march,2009

100

Earnings little affected by drop in oil prices, which should position them well when the industry turns around again. 3% yield also a plus.

Revenue Growth/Loss (Last 3 Years) ? 25.00%
Profit Margin ? 10.00%
Price to Earnings Growth <1
Debt to Capital (MRQ) ? 30.00%
P/E Ratio (TTM) ? 12
Price to Book (MRQ) <1
4-5 Stars on 11/2/08

This stock has a low 1 year forward P/E ratio.

May be foolish questions

1. How will $50 oil (in a year) impact its future growth potential?

2. Considering the highly capital intensive industry, with credit tightening and cost of credit going up, wont it hit its earnings?

I like the growth and fundamentals, and current valuation, but how much upside does this stock really have...? (answers welcomed)