UPDATE 1-Goldman downgrades Halliburton, three others
June 25 (Reuters) - Goldman Sachs cut its ratings on Halliburton Co (HAL.N), Nabors Industries Ltd (NBR.N), Patterson-UTI Energy Inc (PTEN.O) and Oil States International Inc (OIS.N), saying it does not expect high beta stocks with gas leverage to outperform.
The brokerage, which maintained its "attractive" view on oil services/drilling sector, while shifting its preference towards oil-leveraged stocks, upgraded Cameron International Corp (CAM.N), Transocean Ltd (RIG.N), Diamond Offshore Drilling Inc (DO.N), FMC Technologies Inc (FTI.N). [ID: nWNAB2041]
"While we continue to believe that the turn in fundamentals is in sight and that we are in the midst of the next up-cycle, we are less positive on 'gassy' North American levered stocks given that we see reduced upside potential for 2010," analyst Daniel Boyd wrote in a note to clients.
Boyd said the industry was moving towards a period of positive earnings revision, to be driven by oil levered international markets.
"We expect oil prices to trend higher as offshore drillers and oil service companies regain pricing power and the marginal cost curve rises," he added.
Boyd added Cameron to conviction buy list and said the company should bag new orders as oil prices stabilize and capital markets improve. He removed Halliburton from the list.
The analyst added he continued to view conviction buy list-rated Weatherford International Ltd (WFT.N) as one of his top picks. (Reporting by Arup Roychoudhury in Bangalore; Editing by Anil D'Silva)
(arup.roychoudhury@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: arup.roychoudhury.reuters.com@reuters.net))
