Highlights

  • Oceaneering shows 43.48% basic EPS growth, a P/E of 11.95 and PEG of 0.60.
  • Third quarter diluted earnings per share were $0.52, against $0.71 a year earlier.
  • Oceaneering issued $500 million of 6.875% senior notes due 2034 and extended its revolver.
  • Management initiated 2027 consolidated EBITDA guidance of $430 million to $480 million.

Growth, P/E and PEG sit side by side at Oceaneering International (NYSE:OII), an undervalued growth stock: basic earnings per share grew 43.48% over one year, the trailing twelve-month P/E ratio is 11.95 and the PEG ratio, on an expected basis, is 0.60, with shares trading at USD 41.94 on October 28, 2026, up 1.13%. In its latest disclosures, the offshore technology group completed a $500 million senior notes issuance on July 6, reported third quarter 2026 revenue of $784,554 thousand on October 22, and initiated 2027 consolidated EBITDA guidance of $430 million to $480 million.

Oceaneering International, Inc. is headquartered in Houston, Texas, and is incorporated in Delaware. It describes itself as a global technology company delivering engineered services and products and robotic solutions to the offshore energy, defense, aerospace and manufacturing industries. It reports five segments: Subsea Robotics, Manufactured Products, Offshore Projects Group, Integrity Management & Digital Solutions, and Aerospace and Defense Technologies. The company states it believes it is the world's largest provider of remotely operated vehicle (ROV) services.

Growth: Third Quarter Earnings, Revenue and Segments

Net income attributable to Oceaneering was $52,618 thousand in the third quarter against $71,289 thousand a year earlier, and $153,740 thousand for the nine months against $176,108 thousand. Basic earnings per share were $0.53 against $0.71, and diluted earnings per share were $0.52 against $0.71.

Revenue was $784,554 thousand against $742,898 thousand, and income from operations was $92,153 thousand against $86,508 thousand. The company said operating results rose 7% on a 6% increase in revenue and cited results in Subsea Robotics and the Offshore Projects Group. A loss on extinguishment of debt of $19,034 thousand was recorded.

Subsea Robotics revenue was $232,995 thousand with operating income of $75,363 thousand against $65,142 thousand, and ROV utilization was 65% in both periods. Aerospace and Defense Technologies revenue was $135,074 thousand against $125,909 thousand.

Valuation: P/E of 11.95, PEG of 0.60 and Cash Generation

The P/E ratio of 11.95 is measured on trailing twelve-month earnings, and the PEG ratio of 0.60 on expected growth. The company generated $163 million from operating activities in the third quarter and $159 million in the nine months, against $101 million and $98 million a year earlier. Total equity was $1,226,882 thousand at September 30, 2026, against $1,076,663 thousand at December 31, 2025.

Capital expenditures were $62 million for the nine months against $81 million.

Capital Returns, Debt and Liquidity

On July 6, 2026, Oceaneering issued $500 million of 6.875% senior notes due 2034 and used the proceeds, with cash on hand, to fund a tender offer for its 2028 senior notes. It amended its senior secured revolving credit facility to $345 million of commitments, extended to July 2031, with the full amount unused. At September 30, 2026, the nearest debt maturity was the $500 million of 2034 notes.

Cash and cash equivalents were $735 million and working capital was $921 million. The company repurchased 0.1 million shares for $5.0 million in the third quarter and 0.4 million shares for $15 million in the nine months under its 10 million share program, approved in December 2014 with no expiration date.

Disclosed Risks and Outlook

Diluted earnings per share fell in both periods, which the company linked to the debt refinancing loss on the call. Manufactured Products backlog was $435 million against $568 million a year earlier, which the company attributed to the timing of awards, and the trailing 12-month book-to-bill ratio was 0.77 against 0.82. ROV utilization was 64% for the nine months against 66%, with fewer days utilized in the U.S. Gulf.

Integrity Management & Digital Solutions operating income was $1,854 thousand for the nine months against $10,865 thousand, and Aerospace and Defense Technologies operating income was $14,749 thousand against $16,557 thousand for the quarter. It disclosed that litigation arises in the ordinary course and that it does not expect a material adverse effect.

On the third quarter 2026 call, management guided fourth quarter consolidated EBITDA to $85 million to $95 million and said Subsea Robotics operating income is expected to decrease on ROV geographic mix and mobilization costs as rigs relocate from the U.S. Gulf. Management initiated 2027 consolidated EBITDA guidance of $430 million to $480 million, with free cash flow expected to exceed the 2026 level, and plans to continue share repurchases in 2027. It said more detailed 2027 guidance will follow at year-end reporting.