Borr Drilling Ltd
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Energy : Energy Equipment & Services | Small Cap Value
Based in Bermuda
Company profile

Borr Drilling Limited is an offshore shallow-water drilling contractor. The Company’s primary business is the ownership, contracting and operation of jack-up rigs for operations in shallow-water areas, providing drilling services to the oil and gas exploration and production industry. Its jack-up rigs are capable of drilling to a maximum well depth of approximately 35,000 feet while operating in water depths ranging from 30 to 400 feet. It operates in oil-producing geographies throughout the world, including the North Sea, Mexico, West Africa, Southeast Asia and the Middle East. It owns approximately 23 jack-up rigs, which include Skald, Groa, Idun, Thor, Norve, Gerd, Natt, Ran, Odin, Gersemi, Grid, Galar, Njord, Prospector 1, Saga, Prospector 5, Mist, Gunnlod, Frigg, Gyme, Hermod, Heimdal and Hild. The Company contract its jack-up rigs primarily on a day rate basis to drill wells for its customers, including state-owned national oil companies and independent oil and gas companies.

Premarket

Last Trade
Delayed
$3.80
-0.02 (-0.52%)
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Market Hours

Closing Price
$3.82
Day's Change
0.00 (0.00%)
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Volume
(Light)
Volume:
11,958

10-day average volume:
1,616,965
11,958

Stifel cuts cannabis industry view as analysts weigh Tilray

8:40 am ET May 3, 2022 (MarketWatch)
Print

By Steve Gelsi

Stifel analyst bemoans 'hydroponics category recession'; Tilray price target reduced after analyst day.

Stifel analyst W. Andrew Carter on Monday said the firm continues to approach the cannabis sector with "negative overall bias" amid a reduced outlook for the U.S. market and lackluster performance in the hydroponics sector.

Carter trimmed his view for the total 2022 U.S. cannabis sales to $27.2 billion from an earlier estimate of $28.6 billion amid decelerating category growth, oversupply, outsized pressure on lower income consumer spending, rising input costinflation and increased capital costs.

Stifel reiterated sell ratings on Aurora Cannabis (ACB.T) and Canopy Growth (WEED.T) because of an "increasingly difficult Canadian market." The brokerage cut its Aurora Cannabis price target to C$3.00 from C$3.50 and trimmed Canopy Growth's price target to C$6 from C$7.50.

Cannabis software maker WM Technology Inc. (MAPS) stands out as "the best positioned" cannabis name to capitalize on category growth, with shares that continue to undervalue a "robust" growth outlook, he said. WM Technology's price target was reduced by $1 to $10 a share.

Carter also remains "increasingly positive" on Altria Group Inc. (MO)-backed Cronos Group Inc. (CRON.T) on strength in its Spinach cannabis business, as well as accessories seller GrowGeneration Corp. (GRWG) on its supply chain skills. Cronos's price target was set at $4 a share, while GrowGeneration's price target was trimmed to $8.50 a share from $9.

Stifel shaved its 2022 earnings view on ScottsMiracle-Gro Co. (SMG) to $7.31 a share from $8.02 a share on weakness in its Hawthrorne hydroponics business and an overall recession in the business. Stifel cut its price target on the company to $130 a share from $160 a share.

"We now estimate a less fulsome recovery for Hawthorne... given colder weather, and higher input costs," Carter said. "But with our reductions, we believe the earnings growth profile remains undervalued."

Also Read:Scotts Miracle-Gro-backed RIV Capital buying New York cannabis company Etain

Stifel cut its Hydrofarm Holdings Group Inc.'s (HYFM) 2022 revenue estimate to $573 million from $595 million as it competes with promotional efforts from Hawthorne. Stifel slashed its Hydrofarm price target to $13 a share from $33.

Shares of Hydrofarm Holding are down 65.8% in 2022, but the stock rose 1.7% on Monday. Scotts Miracle-Gro shares rose 3.7% on Monday, but the stock has lost 33% so far this year.

Meanwhile, Alliance Global Partners analyst Aaron Grey on Monday cut his target price on Tilray (TLRY) to $5.50 a share from $8.00 and reiterated a neutral rating on the stock after the company held an analyst day last week.

Although the company reiterated its plan to grow revenue to $4 billion in 2024 from about $630 million in 2022, that path "embeds a number of factors outside its control" such as the legalization of adult use cannabis in the U.S. and Germany and "more rational" market conditions in Canada, Grey said.

While reaching $4 billion "could prove a difficult task" without acquisitions beyond those already embedded, Tilray offers some bright spots, such as 12 consecutive quarters of Ebitda and positive cash flow on the horizon, plus its strategy of adding "self-sustaining" businesses in the U.S. such as its beverages as it awaits catalysts for more growth, Grey said.

Shares of Tilray rose 2% on Monday. The stock is down 27.7% so far this year.

Overall, stock performance in the cannabis sector remains weak. The AdvisorShares Pure Cannabis ETF (MSOS) has lost 41.2% of its value in 2022, compared to a drop of 20.3% by the Nasdaq. The Cannabis ETF (THCX) has dropped 33.4% so far in 2022.

Also Read: Investors in cannabis companies burned by stock-market losses in 2021 even as the pot business grows

-Steve Gelsi

	

(END) Dow Jones Newswires

May 03, 2022 08:40 ET (12:40 GMT)

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