Wunderlich: Hold Steady on Oceaneering International (OII)

Wunderlich Securities analysts Neal Dingmann and Jason Wangler reiterated their Hold rating for Oceaneering International, Inc (NYSE: OII).

OII lowered 2010 EPS guidance after the recently announced six-month deepwater drilling moratorium. Also, the future of shallow water drilling in the Gulf of Mexico is uncertain.

The analysts say, "Our new 2010 estimates better reflect company expectations of $2.80-$3.10 per share versus $3.25-$3.55 previously. We could potentially see more pressure given that 70 of Oceaneering's 255 ROVs are positioned in the Gulf of Mexico with 35engaged in drill support service, including 32 on floating drilling rigs. Many of these ROVs have already become idle and more are expected to stop working shortly."

The analysts also think that 2011 activity could be hurt by the deepwater moratorium.

However, international operations remain robust, and Oceaneering's cash balance should help it get through the downtime.

The analysts put the price target for OII at $45. OII is currently trading at $42.99.