Atwood Oceanics, Inc. (ATW)

[gta3uzi]

It has to do with how their revenue is structured.

Offshore oil drillers operate on contract. The contracts they have right now are fairly safe, with a few exceptions like PEMEX and Petrobras, but the likelihood of new contracts or contract extensions coming in to replace the expiring ones are slim. This means that 2016 and 2017 could be an absolute bloodbath if oil stays around the same price levels we're seeing today.

Within that statement we have a few camps who think varying thoughts on competitiveness. We have discount drillers with old fleets like Hercules and Paragon. Their fleets are fairly depreciated and old, but they might be able to offer inexpensive services and obtain contracts where companies like Seadrill who have newer, expensive fleets might not be able to compete on a price basis. Some think that the newer fleet operators might undercut the older rigs, but contracts are for one to three years or more and they would lock themselves into an "ugly" contract if they do that and things rebound.

This is only a small snapshot of what's going on, but I think it starts to illustrate why P/E is temporarily so attractive on a few companies.