Rowan Companies Inc. (RDC: sentiment, chart, options) performs contract drilling of oil and gas wells. Its fleet consists of 22 jack-up rigs and 32 land-drilling rigs. The company operates primarily in the Middle East, Texas, the Gulf of Mexico, and the North Sea.
Technically speaking, the stock has been in a steep uptrend since the market bottom in March, rallying more than 163% from its low near $10.28 per share. The equity is currently up more than 70% so far in 2009, easily outperforming the S&P 500 Index during the same period.
What's more, RDC has ridden support at its 10-week and 20-week moving averages steadily higher since early March. The shares are currently rebounding from support at their 10-week trendline and are poised to challenge short-term resistance near $27 per share - a region that rejected the security in late October.
Despite the strong uptrend, there is plenty of sideline money available to the equity. In fact, heavy investor pessimism could be a sign that the stock is poised to move F.A.R.: Fast, Aggressively, and in the Right direction. For such potentially lucrative moves in an equity, it must adhere to our Expectational Analysis ® methodology, which takes into account technical performance, fundamental wherewithal, and the all-important investor sentiment aspect.
In today's edition of the Casual Contrarian, I take a closer look at the three elements of Expectational Analysis ® and how they apply to Rowan Companies in order to determine if the stock would make a nice contrarian play. So sit back, enjoy, and good luck in your trading.
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