[Executive Summary & Business Outlook](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Outlook) [Third Quarter 2025 Performance Highlights](index=1&type=section&id=Third%20Quarter%202025%20Performance%20Highlights) Oceaneering reported strong Q3 2025 results, exceeding guidance with adjusted EBITDA of **$111 million**, driven by solid performance across all segments including higher-margin backlog conversion in Manufactured Products, favorable project mix in OPG, and improved ROV revenue per day in Subsea Robotics. The company also secured **$854 million** in new orders - Adjusted EBITDA in excess of guidance range and consensus estimates through solid performance across segments[4](index=4&type=chunk) - Secured total inbound orders of **$854 million**, with notable contract wins in SSR, Aerospace and Defense Technologies (ADTech), and Manufactured Products[4](index=4&type=chunk) [Full-Year 2026 Outlook](index=1&type=section&id=Full-Year%202026%20Outlook) Oceaneering is optimistic about consolidated growth opportunities for 2026, primarily led by ADTech, with an initial full-year consolidated EBITDA guidance of **$390 million** to **$440 million**. Activity levels are expected to be seasonally lower in energy-focused businesses in Q1, increasing in Q2 and Q3 - Optimistic about consolidated growth opportunities for 2026, to be led by ADTech[5](index=5&type=chunk) Initial Full-Year 2026 Consolidated EBITDA Guidance | Metric | Range (Millions) | | :----------------------- | :--------------- | | Consolidated EBITDA | $390 - $440 | - Anticipate seasonally lower activity levels in energy-focused businesses in Q1 2026, with activity levels increasing in Q2 and Q3[5](index=5&type=chunk) [Third Quarter 2025 Financial Results](index=1&type=section&id=Third%20Quarter%202025%20Financial%20Results) [Consolidated Financial Performance](index=1&type=section&id=Consolidated%20Financial%20Performance) In Q3 2025, Oceaneering achieved significant year-over-year growth in key financial metrics, with revenue up **9%** to **$743 million**, operating income up **21%** to **$86.5 million**, net income soaring **73%** to **$71.3 million**, and adjusted EBITDA increasing **13%** to **$111 million**. The company also generated strong cash flow from operations and free cash flow Q3 2025 Consolidated Financial Highlights (YoY vs Q3 2024) | Metric | Q3 2025 (Millions) | Q3 2024 (Millions) | Change (%) | | :-------------------------------- | :----------------- | :----------------- | :--------- | | Revenue | $743 | $680 | +9% | | Operating Income | $86.5 | $71.3 | +21% | | Net Income | $71.3 | $41.2 | +73% | | Adjusted EBITDA | $111 | $98.1 | +13% | | Cash flow from operating activities | $101 | $91.9 | +10% | | Free Cash Flow | $77.0 | $67.0 | +15% | - Ending cash position: **$506 million**[6](index=6&type=chunk) - Shares repurchased: **440,814** for approximately **$10.1 million**[6](index=6&type=chunk) [Segment Performance](index=1&type=section&id=Segment%20Performance) Oceaneering's segments showed varied performance in Q3 2025. Manufactured Products and ADTech demonstrated strong growth in both revenue and operating income, while OPG also saw revenue and operating income increases. SSR's revenue and operating income were flat, and IMDS experienced a revenue decrease but a significant operating income improvement due to the absence of a prior-year charge Q3 2025 Segment Performance Overview (YoY vs Q3 2024) | Segment | Revenue Change (%) | Operating Income Change (%) | Operating Income Margin (Q3 2025) | | :-------------------------------- | :----------------- | :-------------------------- | :-------------------------- | | Subsea Robotics (SSR) | Flat | Flat | 30% | | Manufactured Products | +9% | +119% | 16% | | Offshore Projects Group (OPG) | +16% | +17% | 14% | | Integrity Management & Digital Solutions (IMDS) | -4% | Significantly increased | 4% | | Aerospace and Defense Technologies (ADTech) | +27% | +36% | 13% | | Unallocated Expenses | N/A | +19% (increase) | N/A | [Subsea Robotics (SSR)](index=1&type=section&id=Subsea%20Robotics%20(SSR)) - ROV revenue per day utilized increased **6%** to **$11,254**[7](index=7&type=chunk) - ROV fleet utilization declined to **65%**[7](index=7&type=chunk) - Operating income margin was **36%**[7](index=7&type=chunk) [Manufactured Products](index=1&type=section&id=Manufactured%20Products) - Operating income improved **119%** and operating income margin expanded to **16%** on a **9%** increase in revenue[7](index=7&type=chunk) - Backlog was **$568 million** on September 30, 2025[7](index=7&type=chunk) - The book-to-bill ratio was **0.82** for the 12-month period ending on September 30, 2025[7](index=7&type=chunk) [Offshore Projects Group (OPG)](index=1&type=section&id=Offshore%20Projects%20Group%20(OPG)) - Operating income increased **17%** on a **16%** increase in revenue[7](index=7&type=chunk) - Operating income margin was flat at **14%**[7](index=7&type=chunk) [Integrity Management and Digital Solutions (IMDS)](index=1&type=section&id=Integrity%20Management%20and%20Digital%20Solutions%20(IMDS)) - Operating income increased significantly, and operating income margin improved on a **4%** decrease in revenue[7](index=7&type=chunk) - Improvement due to the absence of a one-time, non-cash charge in Q3 2024 related to the divestiture of the Maritime Intelligence division[7](index=7&type=chunk) [Aerospace and Defense Technologies (ADTech)](index=1&type=section&id=Aerospace%20and%20Defense%20Technologies%20(ADTech)) - Operating income of **$16.6 million** represented an increase of **36%** on a **27%** increase in revenue[7](index=7&type=chunk) - Operating income margin improved to **13%**[7](index=7&type=chunk) [Unallocated Expenses](index=1&type=section&id=Unallocated%20Expenses) - Unallocated Expenses increased **19%** to **$46.3 million**[7](index=7&type=chunk) [Financial Guidance](index=2&type=section&id=Financial%20Guidance) [Fourth Quarter 2025 Guidance](index=2&type=section&id=Fourth%20Quarter%202025%20Guidance) Oceaneering anticipates lower consolidated revenue for Q4 2025 compared to Q4 2024, with consolidated EBITDA projected to be in the range of **$80 million** to **$90 million**. Segment-level expectations vary, with SSR and ADTech expecting increases, Manufactured Products expecting significant operating income increase on lower revenue, and OPG and IMDS expecting significant decreases - Consolidated fourth quarter 2025 revenue is expected to be lower compared to the fourth quarter of 2024[8](index=8&type=chunk) Q4 2025 Consolidated EBITDA Forecast | Metric | Range (Millions) | | :-------------------- | :--------------- | | Consolidated EBITDA | $80 - $90 | Q4 2025 Segment-Level Expectations (YoY vs Q4 2024) | Segment | Revenue Expectation | Operating Income Expectation | | :-------------------------------- | :------------------ | :--------------------------- | | Subsea Robotics (SSR) | Increase | Increase | | Manufactured Products | Lower | Significantly increase | | Offshore Projects Group (OPG) | Significantly decrease | Significantly decrease | | Integrity Management & Digital Solutions (IMDS) | Lower | Significantly decrease | | Aerospace and Defense Technologies (ADTech) | Significantly increase | Significantly increase | | Unallocated Expenses | N/A | $45M range | [Full-Year 2026 Guidance](index=2&type=section&id=Full-Year%202026%20Guidance) Oceaneering has initiated full-year 2026 consolidated EBITDA guidance in the range of **$390 million** to **$440 million**. The company also expects free cash flow generation to be consistent with 2025 levels and anticipates continued share repurchase activity. More specific guidance will be provided in the Q4 2025 earnings release Full-Year 2026 Consolidated EBITDA Guidance | Metric | Range (Millions) | | :-------------------- | :--------------- | | Consolidated EBITDA | $390 - $440 | - Free cash flow generation is forecast to be consistent with 2025 levels[12](index=12&type=chunk) - Share repurchase activity is expected to continue[12](index=12&type=chunk) [Company Information & Disclosures](index=2&type=section&id=Company%20Information%20%26%20Disclosures) [About Oceaneering](index=3&type=section&id=About%20Oceaneering) Oceaneering is a global technology company that provides engineered services and products, along with robotic solutions, to various industries including offshore energy, defense, aerospace, and manufacturing - Oceaneering is a global technology company delivering engineered services and products and robotic solutions[15](index=15&type=chunk) - Serves the offshore energy, defense, aerospace, and manufacturing industries[15](index=15&type=chunk) [Conference Call Details](index=2&type=section&id=Conference%20Call%20Details) Oceaneering scheduled a conference call and webcast for October 23, 2025, at 10:00 a.m. Central Time to discuss Q3 2025 results, Q4 and full-year 2025 guidance, and initial 2026 guidance. A replay will be available on the Investor Relations section of their website - Conference call and webcast scheduled for Thursday, October 23, 2025, at 10:00 a.m. Central Time[10](index=10&type=chunk) - Topics include Q3 2025 results, guidance for Q4 and full year 2025, and initial guidance for full year 2026[10](index=10&type=chunk) - A replay of the conference call will be made available on the Investor Relations section of Oceaneering's website[10](index=10&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) The release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, regarding future business and financial performance, including guidance and market conditions. These statements are based on current expectations and are subject to risks, assumptions, trends, and uncertainties that could cause actual results to differ materially - This release contains "forward-looking statements," as defined in the Private Securities Litigation Reform Act of 1995[11](index=11&type=chunk) - Statements concern Oceaneering's future expected business, financial performance, prospects, and market conditions[11](index=11&type=chunk)[13](index=13&type=chunk) - Subject to certain risks, assumptions, trends, and uncertainties that could cause actual results to differ materially[14](index=14&type=chunk) [Non-GAAP Financial Measures Explanation](index=2&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) The report includes non-GAAP financial measures such as adjusted net income (loss), adjusted EPS, EBITDA, adjusted EBITDA, and free cash flow. These measures exclude certain identified items and are used by management and investors to assess underlying business performance and for valuation purposes, but should not be considered substitutes for GAAP measures - Non-GAAP measures include adjusted net income (loss) and earnings (loss) per share; EBITDA and adjusted EBITDA (and margins); and free cash flow[9](index=9&type=chunk)[26](index=26&type=chunk) - These measures exclude the impacts of certain identified items to provide consistent measures of the underlying results of ongoing business[26](index=26&type=chunk) - Used by investors for valuation purposes and by management for evaluating financial performance, but should not be viewed as substitutes for GAAP measures[26](index=26&type=chunk) [Condensed Consolidated Financial Statements (GAAP)](index=5&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20(GAAP)) [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of September 30, 2025, Oceaneering's total assets increased to **$2.54 billion** from **$2.34 billion** at December 31, 2024. This was primarily driven by an increase in current assets, including cash and cash equivalents, and other assets. Total equity also increased significantly Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2025 | Dec 31, 2024 | Change | | :-------------------------- | :----------- | :----------- | :------- | | Total Assets | $2,539,318 | $2,336,347 | +$202,971 | | Current Assets | $1,501,843 | $1,387,896 | +$113,947 | | Cash and Cash Equivalents | $505,992 | $497,516 | +$8,476 | | Total Liabilities | $1,625,587 | $1,616,025 | +$9,562 | | Equity | $913,731 | $720,322 | +$193,409 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q3 2025, Oceaneering reported revenue of **$742.9 million**, a gross margin of **$152.7 million**, and net income of **$71.3 million**, resulting in diluted EPS of **$0.71**. For the nine months ended September 30, 2025, revenue was **$2.12 billion** and net income was **$176.1 million**, with diluted EPS of **$1.74** Condensed Consolidated Statements of Operations (in thousands, except per share amounts) | Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 | | :-------------------------- | :-------- | :-------- | :-------- | :-------- | | Revenue | $742,898 | $679,811 | $2,115,582 | $1,947,711 | | Gross margin | $152,732 | $130,962 | $436,170 | $343,557 | | Operating income (loss) | $86,508 | $71,333 | $239,169 | $168,390 | | Net Income (Loss) | $71,289 | $41,237 | $176,108 | $91,369 | | Diluted earnings (loss) per share | $0.71 | $0.40 | $1.74 | $0.89 | [Selected Cash Flow Information](index=7&type=section&id=Selected%20Cash%20Flow%20Information) Oceaneering generated **$101.3 million** in cash flow from operating activities and **$77.0 million** in free cash flow for Q3 2025. Total capital expenditures for the quarter were **$31.4 million**, including **$7.2 million** for capitalized cloud-based service contract costs. For the nine months ended September 30, 2025, cash flow from operating activities was **$97.7 million** and free cash flow was **$17.2 million** Selected Cash Flow Information (in thousands) | Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 | | :------------------------------------ | :-------- | :-------- | :-------- | :-------- | | Cash flow provided by operating activities | $101,263 | $91,931 | $97,732 | $74,837 | | Purchases of property and equipment | $(24,215) | $(24,886) | $(80,575) | $(73,262) | | Capitalized cloud-based service contract costs | $7,161 | — | $11,424 | — | | Total Capital Expenditures | $31,376 | $24,886 | $91,999 | $73,262 | | Free Cash Flow | $77,048 | $67,045 | $17,157 | $1,575 | - Total Depreciation and Amortization for Q3 2025 was **$26.1 million**[25](index=25&type=chunk) [Non-GAAP Financial Reconciliations & Estimates](index=8&type=section&id=Non-GAAP%20Financial%20Reconciliations%20%26%20Estimates) [Adjusted Net Income (Loss) and Diluted EPS](index=9&type=section&id=Adjusted%20Net%20Income%20(Loss)%20and%20Diluted%20EPS) For Q3 2025, adjusted net income was **$55.8 million**, resulting in adjusted diluted EPS of **$0.55**, after adjustments primarily for foreign currency gains/losses and discrete tax items. For the nine months ended September 30, 2025, adjusted net income was **$149.6 million**, with adjusted diluted EPS of **$1.47** Adjusted Net Income (Loss) and Diluted EPS (in thousands, except per share amounts) | Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 | | :-------------------------- | :-------- | :-------- | :-------- | :-------- | | Net income (loss) as reported | $71,289 | $41,237 | $176,108 | $91,369 | | Total of adjustments | $(15,528) | $(4,007) | $(26,539) | $(11,685) | | Adjusted Net Income (Loss) | $55,761 | $37,230 | $149,569 | $79,684 | | Diluted EPS as reported | $0.71 | $0.40 | $1.74 | $0.89 | | Adjusted Diluted EPS | $0.55 | $0.36 | $1.47 | $0.78 | [Consolidated EBITDA and Adjusted EBITDA and Margins](index=11&type=section&id=Consolidated%20EBITDA%20and%20Adjusted%20EBITDA%20and%20Margins) Consolidated EBITDA for Q3 2025 was **$110.1 million**, with an EBITDA margin of **15%**. Adjusted EBITDA was **$111.1 million**, also with an adjusted EBITDA margin of **15%**. For the nine months ended September 30, 2025, consolidated EBITDA was **$316.5 million** and adjusted EBITDA was **$311.0 million** Consolidated EBITDA and Adjusted EBITDA (in thousands) | Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 | | :----------------------- | :-------- | :-------- | :-------- | :-------- | | EBITDA | $110,080 | $98,515 | $316,462 | $249,330 | | Adjusted EBITDA | $111,079 | $98,091 | $310,981 | $245,675 | | EBITDA margin % | 15% | 14% | 15% | 13% | | Adjusted EBITDA margin % | 15% | 14% | 15% | 13% | [Free Cash Flow](index=11&type=section&id=Free%20Cash%20Flow) Free cash flow for Q3 2025 was **$77.0 million**, an increase from **$67.0 million** in Q3 2024. For the nine months ended September 30, 2025, free cash flow was **$17.2 million**, significantly higher than **$1.6 million** in the same period of 2024 Free Cash Flow (in thousands) | Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 | | :-------------- | :-------- | :-------- | :-------- | :-------- | | Free Cash Flow | $77,048 | $67,045 | $17,157 | $1,575 | [Fourth Quarter 2025 Consolidated EBITDA Estimate](index=12&type=section&id=Fourth%20Quarter%202025%20Consolidated%20EBITDA%20Estimate) Oceaneering estimates consolidated EBITDA for the fourth quarter of 2025 to be between **$80 million** and **$90 million** Q4 2025 Consolidated EBITDA Estimate (in thousands) | Metric | Low | High | | :-------------------- | :-------- | :-------- | | Consolidated EBITDA | $80,000 | $90,000 | [2025 Free Cash Flow Estimate](index=12&type=section&id=2025%20Free%20Cash%20Flow%20Estimate) For the full year ending December 31, 2025, Oceaneering forecasts free cash flow to be in the range of **$110 million** to **$130 million** 2025 Free Cash Flow Estimate (in thousands) | Metric | Low | High | | :-------------- | :-------- | :-------- | | Free Cash Flow | $110,000 | $130,000 | [2026 Consolidated EBITDA Estimate](index=12&type=section&id=2026%20Consolidated%20EBITDA%20Estimate) Oceaneering's initial guidance for full-year 2026 consolidated EBITDA is projected to be between **$390 million** and **$440 million** 2026 Consolidated EBITDA Estimate (in thousands) | Metric | Low | High | | :-------------------- | :-------- | :-------- | | Consolidated EBITDA | $390,000 | $440,000 | [EBITDA and Adjusted EBITDA and Margins by Segment](index=13&type=section&id=EBITDA%20and%20Adjusted%20EBITDA%20and%20Margins%20by%20Segment) Segment-wise, SSR maintained strong EBITDA margins at **36%** in Q3 2025. Manufactured Products significantly improved its EBITDA margin to **18%**, while OPG's EBITDA margin was **16%**. ADTech also showed a healthy EBITDA margin of **14%** Q3 2025 Segment EBITDA and Adjusted EBITDA Margins | Segment | EBITDA Margin % | Adjusted EBITDA Margin % | | :-------------------------------- | :-------------- | :----------------------- | | Subsea Robotics (SSR) | 36% | 36% | | Manufactured Products | 18% | 18% | | Offshore Projects Group (OPG) | 16% | 16% | | Integrity Management & Digital Solutions (IMDS) | 6% | 6% | | Aerospace and Defense Technologies (ADTech) | 14% | 14% | Nine Months Ended Sep 30, 2025 Segment EBITDA and Adjusted EBITDA Margins | Segment | EBITDA Margin % | Adjusted EBITDA Margin % | | :-------------------------------- | :-------------- | :----------------------- | | Subsea Robotics (SSR) | 35% | 35% | | Manufactured Products | 14% | 14% | | Offshore Projects Group (OPG) | 20% | 20% | | Integrity Management & Digital Solutions (IMDS) | 7% | 7% | | Aerospace and Defense Technologies (ADTech) | 14% | 14% |

Core Insights - Oceaneering reported positive results for the third quarter of 2025, demonstrating resilience in a dynamic market environment [1] Financial Performance - The company continues to show strong financial performance, indicating effective management and strategic positioning within the industry [1] Market Environment - Oceaneering is navigating a dynamic market, which suggests adaptability and responsiveness to changing industry conditions [1]

Core Thesis - Oceaneering International, Inc. (OII) is viewed positively due to its focus on subsea robotics and offshore services, with a current share price of $24.78 and trailing and forward P/E ratios of 12.96 and 18.76 respectively [1][2] Company Overview - Oceaneering International is a leading underwater services contractor, primarily engaged in subsea robotics and offshore oil and gas services, headquartered in Houston, Texas [2] - The company generated 42% of its 2024 revenue from North America, with the rest from regions including Africa, the UK, Norway, Brazil, Asia, and Australia [2] - Oceaneering has a market capitalization of $2.5 billion and 102 million shares outstanding, reflecting the cyclical nature of the offshore capital expenditure (CapEx) environment [2] Financial Performance - The stock has shown a strong correlation with offshore investment cycles, achieving a total return of 842% during the 2005–2013 upcycle but suffering a 96.7% drawdown in the following downturn [3] - The company maintains a conservative balance sheet with a net debt to EBITDA ratio of 1.0x, low intangibles at 3.5% of assets, and capital expenditures at 4% of sales, allowing for significant free cash flow generation [3] - Cash conversion is strong at 138% of net income, although gross margin and net profit margin are modest at 18.2% and 5.5% respectively, reflecting the competitive nature of the business [3] Growth and Stability - Revenue has grown at a 10-year compound annual growth rate (CAGR) of 5.7%, impacted by extended downcycles and a weak upcycle in recent years [4] - Share dilution is minimal at 0.5% of revenue, but management ownership is low at 2.1%, indicating limited alignment with shareholders [4] - Oceaneering is characterized as a stable and reliable cash flow generator in the offshore services sector, though it lacks significant growth potential, with performance largely driven by the offshore CapEx cycle [4] Market Context - The bullish perspective on Oceaneering aligns with broader industry trends, similar to the bullish thesis on Halliburton Company, emphasizing the cyclicality of offshore services and the potential for profitability driven by subsea robotics [5]

Core Points - The Ministry of Commerce of China announced on September 25, 2025, the inclusion of three U.S. entities in the export control list and three U.S. companies in the unreliable entity list to safeguard national security and interests [1][2][6][8] Export Control List - Three U.S. entities, namely Huntington Ingalls Industries, Planate Management Group, and Global Dimensions LLC, have been added to the export control list, prohibiting the export of dual-use items to them [1][6] - Ongoing export activities related to these entities must be halted immediately, and any necessary exports require an application to the Ministry of Commerce [1][6] Unreliable Entity List - Three companies, Saronic Technologies, Aerkomm Inc., and Oceaneering International, have been placed on the unreliable entity list due to their military technology cooperation with Taiwan, which is seen as a threat to China's national sovereignty and security [2][8] - These companies are prohibited from engaging in import and export activities related to China and from making new investments within China [2][8] Implementation - The measures outlined in the announcements will take effect from the date of publication, September 25, 2025 [4]

Core Points - The Ministry of Commerce of China has announced the inclusion of three U.S. entities in the export control list to safeguard national security and interests [2][4] - Additionally, three other U.S. companies have been added to the unreliable entity list due to their military technology cooperation with Taiwan, which China views as a threat to its sovereignty [5][8] Export Control List - Three U.S. entities, namely Huntington Ingalls Industries, Planate Management Group, and Global Dimensions LLC, have been prohibited from receiving dual-use items [2][5] - All ongoing export activities related to these entities must be halted immediately [2][3] Unreliable Entity List - The companies Saronic Technologies, Aerkomm Inc., and Oceaneering International, Inc. have been added to the unreliable entity list, prohibiting them from engaging in import and export activities related to China and from making new investments in the country [5][8] - The decision is based on their military technology cooperation with Taiwan, which China strongly opposes [8][9]

Core Insights - Zacks Premium provides tools for investors to enhance their stock market strategies and confidence [1] - The Zacks Style Scores serve as complementary indicators to the Zacks Rank, helping investors identify stocks with high potential for market outperformance [2] Zacks Style Scores Overview - Stocks are rated A, B, C, D, or F based on value, growth, and momentum characteristics, with higher scores indicating better chances of outperforming the market [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score [3][4][5][6] Value Score - Focuses on identifying undervalued stocks using financial ratios such as P/E, PEG, Price/Sales, and Price/Cash Flow [3] Growth Score - Analyzes projected and historical earnings, sales, and cash flow to find stocks with sustainable growth potential [4] Momentum Score - Targets stocks with upward or downward price trends, utilizing factors like one-week price change and monthly earnings estimate changes [5] VGM Score - Combines all three Style Scores to provide a comprehensive indicator for selecting stocks with attractive value, growth forecasts, and momentum [6] Zacks Rank Integration - The Zacks Rank is a proprietary model based on earnings estimate revisions, with 1 (Strong Buy) stocks historically yielding an average annual return of +23.64% since 1988 [7] - There are over 800 top-rated stocks available, making it essential to use Style Scores to narrow down selections [8] Stock Selection Criteria - Investors should prioritize stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal success [9] - The direction of earnings estimate revisions is crucial; stocks with declining forecasts should be avoided regardless of Style Scores [10] Company Spotlight: Oceaneering International (OII) - Oceaneering International, founded in 1964, is a leading supplier of offshore equipment and technology solutions, generating revenues of $2.7 billion last year [11] - OII holds a Zacks Rank of 2 (Buy) and a VGM Score of A, with a Growth Style Score of A indicating a projected year-over-year earnings growth of 57.9% for the current fiscal year [12] - The company has seen a recent upward revision in earnings estimates, making it a strong candidate for investors [12][13]

Group 1: Core Insights - Earnings per share (EPS) growth is a significant driver of stock performance in the Oil – Energy sector, indicating real strength despite volatility [1] - Par Pacific Holdings, Oceaneering International, and TechnipFMC have shown strong EPS growth, making them attractive investment options [1] Group 2: Par Pacific Holdings - Par Pacific operates an integrated energy platform with a refining capacity of 219,000 barrels per day and over 100 fuel and convenience store locations [2] - The company balances conventional fuel supply with decarbonization initiatives and has a significant interest in natural gas production [3] - Projected earnings for Par Pacific are expected to increase by 516.2% in 2025, with this year's earnings anticipated at $2.28 per share, reflecting a 32% increase from $1.73 in 2019 [3][10] Group 3: Oceaneering International - Oceaneering is a global technology company providing engineered services and advanced robotic solutions across various sectors [4] - The energy sector contributes nearly 75% of Oceaneering's revenues, with a focus on digital and robotics-driven opportunities [5] - Earnings for Oceaneering are forecasted to rise by 57.9% in 2025, reaching $1.80 per share, a significant turnaround from a loss of 83 cents per share in 2019 [6][10] Group 4: TechnipFMC - TechnipFMC is a global provider of subsea and surface technologies, supporting both traditional and emerging energy solutions [7] - The company employs an innovation-led approach, enhancing project economics and reducing carbon intensity through digital tools [8] - Earnings for TechnipFMC are expected to improve by 20% this year to $2.18 per share, with a potential 275% increase from 60 cents in 2019 by 2025 [9][10]

Core Viewpoint - Oceaneering International reported strong Q2 earnings, surpassing estimates, but shares have underperformed the S&P 500 in the past month, raising questions about future performance leading up to the next earnings release [1][2]. Financial Performance - Adjusted profit for Q2 2025 was 49 cents per share, exceeding the Zacks Consensus Estimate of 42 cents and up from 28 cents in the same quarter last year [2]. - Total revenues reached $698.2 million, aligning with estimates and reflecting a 4.4% increase from $668.8 million in the previous year [2]. Segment Performance - **Subsea Robotics**: Revenues were $218.8 million, slightly up from $215 million year-over-year, but missed the estimate of $242.8 million. Operating income rose to $64.5 million from $61.8 million, beating the estimate of $63.1 million, with an EBITDA margin of 35% [4]. - **Manufactured Products**: Revenues increased to $145.1 million from $139.3 million, surpassing the estimate of $139.4 million. Operating profit grew to $18.8 million from $14.4 million, exceeding the estimate of $15.3 million [5]. - **Offshore Projects Group**: Revenues rose 3.6% to $149.3 million from $144.1 million, but fell short of the estimate of $144.6 million. Operating income improved to $21.7 million from $13.2 million, beating the estimate of $21.4 million [6][7]. - **Integrity Management & Digital Solutions**: Revenues increased to $75.4 million from $73.5 million, exceeding the estimate of $73.8 million. Operating income rose to $4.6 million from $3.5 million, beating the projection of $4.4 million [8]. - **Aerospace and Defense Technologies**: Revenues grew to $109.6 million from $97 million, surpassing the estimate of $98 million. Operating income increased to $16.3 million from $7.2 million, beating the estimate of $10 million [9][10]. Capital Expenditure & Balance Sheet - Capital expenditure for Q2 totaled $32.8 million. As of June 30, 2025, cash and cash equivalents were $434 million, with long-term debt at approximately $484.6 million, resulting in a debt-to-total capital ratio of 36.4% [11]. Analyst Sentiment - No earnings estimate revisions were made by analysts in the last two months, indicating a period of stability in expectations [12]. Investment Scores - Oceaneering International holds a Growth Score of A and a Value Score of A, placing it in the top 20% for the value investment strategy, while it lags in Momentum Score with a D. The aggregate VGM Score is A [13]. Outlook - The company has a Zacks Rank of 3 (Hold), suggesting an expectation of an in-line return from the stock in the upcoming months [14].

Core Insights - Oceaneering International, Inc. (OII) has secured an $86 million indefinite-delivery/indefinite-quantity (IDIQ) contract from the Naval Supply Systems Command Weapon Systems Support (NAVSUP WSS) for repairing valves and actuators on Virginia-class and Los Angeles-class submarines [1][2][21] Contract Details - The contract has a base value of up to $86 million for an initial two-year period, with an option for a three-year extension [2] - Work will be conducted at Oceaneering's specialized repair facilities, which are equipped with advanced engineering infrastructure and experienced personnel [2][8] Role in Submarine Support - Oceaneering is one of three selected suppliers responsible for restoring key mechanical components that ensure submarine reliability and mission success [3][9] - The contract reinforces Oceaneering's position as a long-term partner in sustaining the Navy's advanced undersea platforms [3] Corporate Component Repair Program (CCRP) - The CCRP standardizes the repair and overhaul process for high-value submarine parts, improving turnaround times and controlling maintenance costs [4] - Oceaneering has over eight years of service under the CCRP, consistently delivering high-precision repairs that meet Navy standards [5] Technical Standards and Repair Operations - Repairing valves and actuators requires exacting technical standards, including disassembly, non-destructive testing, and final performance validation [6][7] - Oceaneering's facilities are optimized for submarine systems service, featuring specialized clean rooms and high-tolerance machining environments [8] Funding and Execution - The contract is funded through Navy Working Capital Funds, ensuring uninterrupted program continuity and rapid mobilization [11][12] - Immediate execution of component servicing is guaranteed upon award, supporting maintenance cycles and mission readiness [12] Strategic Importance - The contract supports the Navy's objective to reduce life cycle costs and minimize equipment downtime, which is vital for maintaining U.S. naval superiority [15] - Oceaneering's advanced repair capabilities enhance operational excellence and ensure high-quality outcomes [16][17] Future Readiness - The IDIQ contract aligns with Oceaneering's long-term vision of providing superior lifecycle support to the U.S. military [18] - Investments in workforce training and advanced materials testing are expected to elevate repair effectiveness and reduce lead times [18][19]

Core Insights - Oceaneering International, Inc. (OII) reported an adjusted profit of 49 cents per share for Q2 2025, exceeding the Zacks Consensus Estimate of 42 cents and up from 28 cents in the same quarter last year, driven by strong operating income across its segments [1][9] - Total revenues reached $698.2 million, aligning with the Zacks Consensus Estimate and reflecting a 4.4% increase from $668.8 million in the prior year, attributed to robust revenue contributions from various segments [2][9] - Adjusted EBITDA for the quarter was $103.3 million, marking a 20.3% year-over-year increase, indicating strong operational execution [2][9] Revenue Breakdown by Segment - **Subsea Robotics**: Revenues were $218.8 million, slightly up from $215 million year-over-year, but missed the estimate of $242.8 million. Operating income increased to $64.5 million from $61.8 million, surpassing the estimate of $63.1 million, with an EBITDA margin of 35% and ROV fleet utilization at 67% [4] - **Manufactured Products**: This segment reported revenues of $145.1 million, up from $139.3 million a year ago, exceeding the estimate of $139.4 million. Operating profit rose to $18.8 million from $14.4 million, also beating the estimate of $15.3 million [5] - **Offshore Projects Group**: Revenues increased by 3.6% to $149.3 million from $144.1 million year-over-year, but fell short of the estimate of $144.6 million. Operating income improved to $21.7 million from $13.2 million, exceeding the estimate of $21.4 million [6][7] - **Integrity Management & Digital Solutions**: Revenues were $75.4 million, up from $73.5 million year-over-year, beating the estimate of $73.8 million [8] - **Aerospace and Defense Technologies**: Revenues totaled $109.6 million, an increase from $97 million in the prior year, surpassing the estimate of $98 million. Operating income rose to $16.3 million from $7.2 million, exceeding the estimate of $10 million [10][11] Financial Position - As of June 30, 2025, OII had cash and cash equivalents of $434 million and long-term debt of approximately $484.6 million, resulting in a debt-to-total capital ratio of 36.4% [12] Future Outlook - For Q3 2025, OII anticipates an increase in consolidated revenues compared to Q3 2024, with EBITDA expected to range between $100 million and $110 million. Growth is expected in Subsea Robotics and Manufactured Products, while Offshore Projects Group may see a decline in operating profitability [13][14] - For the full year 2025, consolidated revenues are projected to grow at a mid-single-digit percentage rate, with adjusted EBITDA anticipated to be between $390 million and $420 million [15]