Diamond Offshore Gets Earnings Downgrade: Barron’s

Diamond Offshore Drilling DO management recently slashed its special dividend. The dividend has been reduced from $1.375 to 75 cents for the quarter. According to Barron’s equity research firm Sterne Agee & Leach has pared down its earnings estimates for the company. Diamond offshore (DO) is now expected to earn $6.90 in EPS for year 2010, down from $7.65. For 2011, its EPS estimates have been cut down from $7.42 to $6.22. The company has been given a ‘neutral’ rating. The company currently has six floaters in the US Gulf of Mexico. However, two of them, Ocean Confidence and Ocean Endeavor, are leaving for the Congo and Egypt, respectively. The US government’s handling of the gulf crisis has also increased America's risk profile. Sterne believes that this would negatively impact the company’s plans to expand in the country.