RigNet Inc (RNET) has seen its stock price decline significantly in the last few months due to investor lack of confidence in the company’s ability to grow the customer base in a falling oil price environment, despite the company’s leading position among data providers to rigs in a world with growing data needs, says Brandon Dobell, Partner and Group Head of Global Services at William Blair & Company, L.L.C.
“We feel pretty confident that investor expectations have gotten so low relative to RigNet’s ability to add customers and importantly drive more bandwidth to those customers as the need for data continues to grow. We think the expectations in the stock are now at a very low point, which should set it up pretty well,” Dobell said.
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Dobell says RigNet is one of the few companies capable of providing oil and gas producers with the network services they require to operate, and he expects investors to rethink their current perception in the next couple of months, after RNET surprises them with its positive performance.
“An offshore rig has information that need to back and forth with the control rooms back in Houston; production data has to go back to the E&P, telephone calls, compliance, safety monitoring, both data, video and calls. Somebody needs to get that communications network set up so the rig that’s 20 miles offshore, 200 miles offshore can communicate with the shore and vice versa. And RigNet is one of really two major players offshore and one of a few companies onshore that has a network big enough and robust enough to deliver any kind of communications to anywhere in the world through a variety of technology platforms,” Dobell said.
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