Oceaneering International Inc (NYSE: OII)

Sector: Energy Industry: Oil & Gas Equipment & Services CIK: 0000073756
Market Cap 3.25 Bn
P/B 3.58
P/E 14.01
P/S 1.15
ROIC (Qtr) 17.61
Div Yield % 0.00
Rev 1y % (Qtr) 9.28
Total Debt (Qtr) 772.50 Mn
Debt/Equity (Qtr) 0.85
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About

Oceaneering International Inc., a global technology company with the NYSE ticker symbol 'OII', operates primarily in the offshore energy, defense, aerospace, manufacturing, and entertainment industries. The company's main business activities involve developing and marketing underwater services and products, leveraging advanced technology to cater to customer needs. With a presence in over 50 countries, Oceaneering is a major player in the global underwater services market. Oceaneering's operations span across four business segments: Subsea Robotics,...

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Investment thesis

Bull case

  • Operating cash flow of 226.11M provides strong 15.40x coverage of stock compensation 14.68M, indicating sustainable incentive practices.
  • Strong tangible asset base of 2.49B provides 3.22x coverage of total debt 772.50M, indicating robust asset backing and low credit risk.
  • Tangible assets of 2.49B provide exceptional 21.10x coverage of deferred revenue 117.92M, showing strong service capability backing.
  • Retained earnings of 1.75B provide full 2.26x coverage of long-term debt 772.50M, indicating strong internal capital position.
  • Robust tangible asset base of 2.49B provides 3.37x coverage of working capital 737.98M, indicating strong operational backing.

Bear case

  • Operating cash flow of 226.11M barely covers its investment activities of (129.44M), with a coverage ratio of -1.75, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Cash reserves of 505.99M provide limited coverage of acquisition spending of (25.14M), which is -20.12x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 119.71M represents just -1068.88x of debt issuance (112000), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • High depreciation of 101.11M relative to operating cash flow of 226.11M, which is 0.45x suggests significant maintenance capital requirements affecting free cash flow.
  • Operating cash flow of 226.11M is outpaced by equity issuance of (40.27M) (-5.61 ratio), indicating concerning reliance on equity markets for funding operations.

Product and Service Breakdown of Revenue (2024)

Geographical Breakdown of Revenue (2024)

Peer comparison

Companies in the Oil & Gas Equipment & Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SLB Slb Limited/Nv 59.56 Bn 20.77 2.67 11.64 Bn
2 BKR Baker Hughes Co 59.13 Bn 22.85 2.13 6.09 Bn
3 FTI TechnipFMC plc 28.99 Bn 127.65 1.96 1.34 Bn
4 HAL Halliburton Co 28.83 Bn 22.47 1.30 8.13 Bn
5 WFRD Weatherford International plc 7.39 Bn 17.15 1.50 1.64 Bn
6 NOV NOV Inc. 7.09 Bn 48.90 0.81 2.34 Bn
7 VAL Valaris Ltd 6.32 Bn 15.83 2.61 1.09 Bn
8 KGS Kodiak Gas Services, Inc. 4.56 Bn 91.00 3.58 2.66 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.38 1.17
EV to Cash from Ops. EV/CFO 15.52 -3.30
EV to Debt EV to Debt 4.54 10.99
EV to EBIT EV/EBIT 10.50 4.49
EV to EBITDA EV/EBITDA 8.39 6.54
EV to Free Cash Flow [EV/FCF] EV/FCF 29.31 31.31
EV to Market Cap EV to Market Cap 1.08 1.36
EV to Revenue EV/Rev 1.24 2.02
Price to Book Value [P/B] P/B 3.58 1.73
Price to Earnings [P/E] P/E 14.01 20.20
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 0.42
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 5.49
Dividend per Basic Share Div per Share (Qtr) 0.00 0.26
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 6.68
Interest Coverage Int. cover (Qtr) 8.87 -10.19
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -7.19 -37.90
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 11.98 1,334.16
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 4.06
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 63.47 -12.71
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 30.82 19.66
EBIT Growth (1y) % EBIT 1y % (Qtr) 39.94 -26.68
EBT Growth (1y) % EBT 1y % (Qtr) 46.28 39.97
EPS Growth (1y) % EPS 1y % (Qtr) 72.39 27.30
FCF Growth (1y) % FCF 1y % (Qtr) -6.76 -867.31
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 28.70 5.49
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.11 0.74
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.10
Cash Ratio Cash Ratio (Qtr) 0.66 0.62
Current Ratio Curr Ratio (Qtr) 1.97 2.25
Debt to Equity Ratio Debt/Equity (Qtr) 0.85 0.88
Interest Cover Ratio Int Coverage (Qtr) 8.87 -10.19
Times Interest Earned Times Interest Earned (Qtr) 8.87 -10.19
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 15.40 16.47
EBIT Margin % EBIT Margin % (Qtr) 11.81 -0.62
EBT Margin % EBT Margin % (Qtr) 10.48 4.39
Gross Margin % Gross Margin % (Qtr) 20.40 30.41
Net Profit Margin % Net Margin % (Qtr) 8.20 2.67