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Transocean shares surge after solid earnings beat

The J. W. McLean offshore drill rig, operated by Transocean Ltd., stands anchored in the Cromarty Firth in Invergorgon, U.K.
Simon Dawson | Bloomberg | Getty Images
The J. W. McLean offshore drill rig, operated by Transocean Ltd., stands anchored in the Cromarty Firth in Invergorgon, U.K.

Shares of Transocean surged as much as 11 percent Thursday after reporting earnings that easily topped Wall Street expectations.

The stock later pared its gains, but still ended the day 6 percent higher.

On Wednesday, Transocean reported adjusted earnings of 25 cents a share on $903 million in revenue. Analysts had expected the company to post earnings per share of 14 cents on revenue of $861.9 million, according to a Thomson Reuters consensus estimate.

The stock was subsequently upgraded to "buy" from "hold" at Canaccord Genuity. The firm raised its price target to $11 from $9, saying that the combination of Transocean's debt management and cost trends have resulted in a balance sheet that is "looking significantly more robust."

Even with Thursday's gains, Transocean shares are down 20 percent this year.