Steel Partners II is concerned by "significant inventory write-offs" that Rowan took in the fourth quarter and by "unusual and improper" compensation and severance arrangements with the retiring and new CEOs and other executives. Steel Partners also called "outrageous" a $13 million professional-service fee that Rowan paid in connection with the suspended LeTourneau Technologies monetization process. Steel Partners II owns 9,878,219 shares (8.7%).

Steel Partners II reduced its holdings to about 8.5 million shares (7.5%) from the 10.05 million (8.9%) that it had reported owning on June 30.

Cramer cautioned investors to scale out of the oil stocks that are directly affected by the decline in oil prices. They include companies such as Transocean (RIG), Rowen Drilling (RDC), Chesapeake Energy (CHK), XTO Energy (XTO) and Ultra Petroleum (UPL). He said while it may be tempting to buy into these names ahead of the media events, the market is indicating there is more pain to come.

Rowan Companies (RDC) upgraded at Jefferies. Rating raised to Buy from Hold. Lowers 2008 EPS estimates to $4.09 from $4.18. Maintains $51 price target.

4

Deutsche downgraded seven offshore drillers. RIG and ESV were downgraded to Sell, Deutsche Bank said. Ratings on DO, HERO, NE, PDE and RDC were also cut to Hold, as the stocks are already pricing in several quarters of strong results.

P/E of 11, a PEG of 0.73 , and a yield of 1.1 .

undervalued driller,

0.44

oil services