With a name like ‘Transocean’ you would think that the company is a shipping company. It does own ships, plenty of them, and it announced today that it bought more. So, here’s news for a “shipping company”, making this post appropriate to this forum. RIG - Transocean Ltd Stock Price and Quote
The ships that Transocean owns and bought might more properly be described as ‘barges’, i.e., mobile offshore drilling units. But the company is interesting as a potential investment nonetheless, for two reasons. #1. Its stock would pass a screen run by a Ben Graham-style value investor in terms of its present valuation, financial health, and future growth prospects. #2. Transocean issues bonds, the 8’s of '27, the 7.5’s of '31, and the 6.8’s of '38.
About those bonds, that is more of a “shoulda been here yesterday” opportunity than a present one for their currently trading at a prem to par. But when considering whether to buy a fractional ownership share of a company, looking at how its debt is trading helps to fill out the picture of its financials. The Moody’s reports can be especially helpful in their warnings of the risks they see ahead for the company and its industry.
Standard Disclaimers: I own some the securities mentioned in this post. Not the stock right now, though I’ve traded in and out of it in the past. But I do own 3 lots of Transocean’s 6.8’ of '38 that I bought at an average cost of 60.755 and on which Fido is marking me to market at 90.66 for a 49.61% gain (which doesn’t include coupons received).
E.g., the lot I bought 07/27/20 at 26.400 has a YTM of 26.9%, --not a typo-- which is decent money and good enough for the girls I go dancing with, as is even the 49% cap-gains gain on the whole position.