The Zacks Analyst Blog Highlights: Baker Hughes Inc., Transocean Inc., Diamond Offshore, Nabors Industries and Helmerich & Payne

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Nov 15, 2012, 08:32 ET

CHICAGO, Nov. 15, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Baker Hughes Inc. (BHI), Transocean Inc. (RIG), Diamond Offshore (DO), Nabors Industries (NBR) and Helmerich & Payne (HP).

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Here are highlights from Thursday's Analyst Blog:

U.S. Rig Count Rises to 1806

In its weekly release, Houston-based oilfield services company Baker Hughes Inc. (BHI) reported a rise in the U.S. rig count (number of rigs searching for oil and gas in the country). This upside can be attributed to an increase in the tally of oil-directed rigs, partially offset by cutbacks in natural gas rig count.

The Baker Hughes rig count, issued since 1944, acts as an important yardstick for drilling contractors such as Transocean Inc. (RIG), Diamond Offshore (DO), Nabors Industries (NBR), Helmerich & Payne (HP), etc. in gauging the overall business environment of the oil and gas industry.

Analysis of the Data

Weekly Summary: Rigs engaged in exploration and production in the U.S. totaled 1,806 for the week ended November 9, 2012. This was up by 6 from the previous week's rig count and indicates the first increase in 3 weeks.

The current nationwide rig count is more than double than that of the 6-year low of 876 (in the week ended June 12, 2009) though it is below the prior-year level of 2,016. It rose to a 22-year high in 2008, peaking at 2,031 in the weeks ending August 29 and September 12.

Rigs engaged in land operations climbed by 7 to 1,740; offshore drilling inched down by 1 to 50 rigs while inland waters activity remained steady at 16 units.

Natural Gas Rig Count: Natural gas rig count decreased for the second time in 3 weeks to 413 (a drop of 11 rigs from the previous week). As per the most recent report, the number of gas-directed rigs is at their lowest level since June 11, 1999 and is down 56% from its 2011 peak of 936, reached during mid-October.

The current natural gas rig count remains 74% below its all-time high of 1,606 reached in late summer 2008. In the year-ago period, there were 877 active natural gas rigs.

Oil Rig Count: The oil rig count – which was at a 25-year high of 1,432 in August – was up by 16 to 1,389. The current tally is way above the previous year's rig count of 1,133. It has recovered strongly from a low of 179 in June 2009, rising almost 8 times.

Miscellaneous Rig Count: The miscellaneous rig count (primarily drilling for geothermal energy) at 4 was up by 1 from the previous week.

Rig Count by Type: The number of vertical drilling rigs rose by 8 to 508, while the horizontal/directional rig count (encompassing new drilling technology that has the ability to drill and extract gas from dense rock formations, also known as shale formations) was down by 2 to 1,298. In particular, horizontal rig units – that reached an all-time high of 1,193 in May this year – decreased by 1 from the last week's level to 1,104.

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