Bulk Transporter  Aug 26  Comment 
Motor carriers transporting security-sensitive hazardous materials (HM) requiring a security plan are being granted an exemption from the federal hours-of-service (HOS) regulations that prohibit commercial motor vehicle (CMV) drivers from driving...
Market Intelligence Center  Aug 12  Comment 
The patented option-trade picking algorithms that power MarketIntelligenceCenter.com's Artificial Intelligence Center have selected a covered-call trade on Hornbeck Offshore Services Inc. (HOS) that includes 16% downside protection. Sell one...
Bulk Transporter  Aug 5  Comment 
The Federal Motor Carrier Safety Administration (FMCSA) released its own spin on the recent US Government Accountability Office (GAO) report that examined the Agency’s 2014 study on the hours-of-service (HOS) changes that were made in 2011 and...
Market Intelligence Center  May 21  Comment 
A covered call identified by MarketIntelligececenter.com's patented algorithm on Hornbeck Offshore Services Inc. (HOS) could yield about 4.74% (14.41% annualized, for comparison purposes only) in 120 days. Pair a long position in the stock with...
Market Intelligence Center  May 7  Comment 
Hornbeck Offshore Services Inc. (HOS) presents a trading opportunity that offers a 6.76% return in just 134 days. A covered call on Hornbeck Offshore Services at the $21.00 level expiring on Sep. '15 offers an assigned return rate of 6.76% or...
Bulk Transporter  May 4  Comment 
The American Trucking Associations Inc (ATA) has applied for an exemption from the federal hours-of-service (HOS) regulations that prohibit commercial motor vehicle drivers from driving a CMV if more than eight consecutive hours have passed since...


Hornbeck Offshore Services operates offshore supply vessels (OSVs), multi-purpose support vessels (MPSVs), and a shore-base facility. The company makes money by providing logistics support and specialty services to the offshore oil and gas exploration and production industry, primarily in the US, Gulf of Mexico, and select international markets.[1] With increased regulation following incidents in offshore drilling in the Gulf of Mexico (GoM) such as the Deepwater Horizon oil spill by BP (BP), Hornbeck has been forced to diversify its business line from traditional upstream GoM based operations.

Business Growth

Hornbeck comprises of two business units:

  • Upstream operations primarily use OSVs and MPSVs. OSVs serve as exploratory and developmental drilling rigs, whereas MPSVs serve the same purposes except are significantly larger and more complex.[2]
  • Downstream operations provides services for the domestic tank barge industry, which is centered around service for marine transportation of crude oil, petroleum products and petrochemicals. The largest domestic market in this industry is on the East Coast.[3]

Trends and Forces

Following Deepwater Horizon, Government Regulations in the GoM has Tensed Tremendously

Most of HOS's operations are center around the Gulf of Mexico (GoM), but following BP's oil spill in the Deepwater Horizon incident, government regulations concerning offshore oil drilling particularly in the Gulf of Mexico have heightened, thereby influencing the bottom line for companies like HOS. In particular, the US government, through OPA 90, assigns liability to each responsible party for oil removal costs and a variety of public and private damages. Since HOS operates as a support group for oil drilling operations in the GoM, the company is likely to be liable to some extent should incidents occur in the GoM again.

HOS Operates in a High Fixed Costs Industry Making it Difficult to Shift in Demand

The industry in which HOS operates under incurs high levels of fixed costs through its OSV and MPSVs, which are unable to be easily changed regardless of level of business activity. These high costs especially hurt in times of low productivity due to reduced demand. Further weather interruptions such as during Hurricane Season causes significant negative effects as HOS continues to incur costs regardless the equipment is at bay or out at sea.


HOS competes with other offshore drilling support companies such as:

  • Tidewater (TDW) provides offshore supply vessels and marine support services to the offshore energy industry through the operation of offshore marine service vessels.[4]
  • Seacor Holdings (CKH) owns, operates, invests in and marketing equipment, in the offshore oil and gas, industrial aviation and marine transportation industries.[5]
  • GulfMark Offshore (GLF) provides offshore marine services primarily to companies involved in the offshore exploration and production of oil and natural gas.[6]


  1. HOS Business Description
  2. HOS FY2010 10-K, Pg 9
  3. HOS FY2010 10-K, Pg 10
  4. TDW Business Description
  5. CKH Business Description
  6. GLF Business Description
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