Seadrill Limited (SDRL) AI Stock Analysis

• Market Cap: $1.80B
• Dividend Yield: N/A
• Average Volume (3M): 816.72K
• Price to Earnings (P/E): 57.0
• Beta (1Y): 1.23
• Revenue Growth: -9.31%
• EPS Growth: -91.57%
• Country: US
• Employees: 3,300
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Drilling
• EPS (TTM): -0.17
• Shares Outstanding: 62,225,384
• 10 Day Avg. Volume: 754,748
• 30 Day Avg. Volume: 816,715
• PEG Ratio: 0.11
• Price to Book (P/B): 0.91
• Price to Sales (P/S): 1.91
• P/FCF Ratio: -38.37
• Enterprise Value/Market Cap: 1.15
• Enterprise Value/Revenue: 1.53
• Enterprise Value/Gross Profit: 12.72
• Enterprise Value/Ebitda: 8.20
• 1Y Price Target: $35.50
• Price Target Upside: 24.61% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): -0.12
• Revenue Forecast (FY): $1.37B

• Rating: 67 Neutral
• Price Target: $34.00 ▲(19.34% Upside)

Seadrill's strong financial recovery and operational excellence are key strengths, supported by significant contract wins and a positive market outlook. However, challenges in revenue growth, cash flow conversion, and competitive pressures weigh on the overall score.

Positive Factors

Contract Wins and Backlog

The addition of $300 million in new contracts strengthens Seadrill's revenue visibility and market position, supporting long-term stability and growth.

Technological Advancements

Incorporating advanced technologies like MPD enhances Seadrill's operational efficiency and competitiveness, positioning it well for future industry demands.

Operational Excellence

High operational uptime reflects Seadrill's ability to maintain efficient operations, crucial for sustaining profitability and client trust in the long term.

Negative Factors

Revenue Decline

A decline in revenue poses challenges to sustaining growth and profitability, potentially impacting Seadrill's ability to invest in future opportunities.

Competitive Pricing Pressure

Competitive pricing pressures can erode margins and affect Seadrill's ability to secure profitable contracts, impacting long-term financial health.

Idle Rig Concerns

Idle rigs and contract gaps represent underutilized assets, leading to revenue loss and increased costs, challenging Seadrill's operational efficiency.

Seadrill Limited Business Overview & Revenue Model

Company Description

Seadrill Limited (SDRL) is a leading offshore drilling contractor providing services to the oil and gas industry. The company operates a modern fleet of offshore rigs, including drillships, semi-submersibles, and jack-up rigs, catering to various drilling needs in both shallow and deep waters. Seadrill's operations span several regions worldwide, including the North Sea, Brazil, the Gulf of Mexico, and West Africa, positioning it as a key player in the global energy sector.

How the Company Makes Money

Seadrill generates revenue primarily through the provision of drilling services under long-term contracts with major oil and gas companies. The company's revenue model is largely based on day-rate contracts, where clients pay a fixed daily rate for the use of its drilling rigs and associated services. Key revenue streams include drilling contracts, project management services, and ancillary services such as maintenance and logistical support. Significant partnerships with major industry players, along with strategic alliances in various regions, enhance Seadrill's market presence and contribute to its earnings. Additionally, the company's focus on maintaining a modern and efficient fleet helps optimize operational costs and improve profitability.

Seadrill Limited Financial Statement Overview

Summary

Seadrill Limited has shown a robust recovery in profitability with improved margins and a solid equity position. However, challenges in sustaining revenue growth and consistent cash flow conversion highlight areas for improvement.

Income Statement

Seadrill Limited has shown impressive recovery and growth in recent years. The gross profit margin improved significantly from a negative margin in earlier years to a healthy 100% in 2024, indicating strong profitability in its operations. The net profit margin for 2024 was 32.2%, demonstrating substantial net income relative to revenue, primarily due to reduced debt and operational improvements. However, revenue decreased slightly by 5.8% from 2023 to 2024, suggesting potential challenges in maintaining top-line growth.

Balance Sheet

The debt-to-equity ratio is relatively low at 0.21 in 2024, reflecting a stable capital structure with manageable debt levels. The equity ratio of 70.2% also indicates strong shareholder equity relative to total assets. Return on equity for 2024 was 15.3%, showcasing efficient use of equity to generate profits. However, the company has experienced fluctuations in its equity and total assets over the years, which may pose risks if not managed properly.

Cash Flow

Seadrill's free cash flow for 2024 remained stable compared to 2023, with a free cash flow to net income ratio of 0.20, indicating the company is generating adequate cash relative to its net income. The operating cash flow to net income ratio decreased, reflecting a potential area for improvement in converting net income into cash. Positive free cash flow and reduced capital expenditures suggest prudent financial management, although the decline from previous years suggests a need for careful cash flow planning.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.35B	1.39B	1.47B	977.00M	907.00M	961.00M
Gross Profit	163.00M	293.00M	565.00M	277.00M	-38.00M	-323.00M
EBITDA	253.00M	562.00M	494.00M	224.00M	-336.00M	-3.71B
Net Income	77.00M	446.00M	300.00M	3.67B	-587.00M	-4.66B
Balance Sheet
Total Assets	4.07B	4.16B	4.22B	2.80B	3.90B	3.96B
Cash, Cash Equivalents and Short-Term Investments	419.00M	478.00M	697.00M	480.00M	293.00M	491.00M
Total Debt	612.00M	618.00M	610.00M	518.00M	908.00M	6.09B
Total Liabilities	1.20B	1.24B	1.24B	1.10B	7.61B	7.10B
Stockholders Equity	2.87B	2.92B	2.98B	1.70B	-3.72B	-3.14B
Cash Flow
Free Cash Flow	-127.00M	-69.00M	186.00M	-137.32M	-183.00M	-447.00M
Operating Cash Flow	-36.00M	88.00M	287.00M	8.83M	-154.00M	-420.00M
Investing Cash Flow	-118.00M	226.00M	42.00M	336.42M	37.00M	-32.00M
Financing Cash Flow	-291.00M	-532.00M	-200.00M	-356.04M	0.00	-163.00M

Seadrill Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 28.49
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SDRL, the sentiment is Negative. The current price of 28.49 is below the 20-day moving average (MA) of 30.51, below the 50-day MA of 31.39, and above the 200-day MA of 28.00, indicating a neutral trend. The MACD of -0.29 indicates Positive momentum. The RSI at 36.83 is Neutral, neither overbought nor oversold. The STOCH value of 15.65 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SDRL.

Seadrill Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VAL	77 Outperform	$3.70B	9.64	17.49%	―	6.81%	-61.94%
BORR	69 Neutral	$917.65M	10.88	7.08%	7.55%	5.83%	-11.86%
HP	69 Neutral	$2.62B	―	-1.19%	3.82%	25.92%	-109.50%
SDRL	67 Neutral	$1.80B	57.05	1.18%	―	-9.31%	-91.57%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
PTEN	64 Neutral	$2.31B	―	-4.00%	4.73%	-16.59%	83.95%
RIG	60 Neutral	$4.38B	―	-32.05%	―	16.93%	-335.82%

Seadrill Limited Corporate Events

Seadrill Limited Adjusts Executive Salaries for 2025

On August 27, 2025, Seadrill Limited‘s Joint Nomination and Remuneration Committee approved new annual base salaries for several executive officers, effective September 15, 2025. Notably, Torsten Sauer-Petersen’s salary increase reflects his expanded role as Executive Vice President, Chief Technology & Sustainability Officer. This adjustment highlights the company’s strategic focus on technology and sustainability, potentially impacting its operational priorities and market positioning.

The most recent analyst rating on (SDRL) stock is a Hold with a $33.00 price target. To see the full list of analyst forecasts on Seadrill Limited stock, see the SDRL Stock Forecast page.

Seadrill Limited’s Earnings Call Highlights Strategic Growth

Seadrill Limited’s recent earnings call painted a picture of robust financial health and strategic advancements, tempered by certain operational challenges. The overall sentiment was positive, with highlights on strong financial performance, successful contract negotiations, and technological progress. However, these were counterbalanced by legal expenses and a challenging market environment in the U.S. Gulf.

Seadrill Limited Reports Q2 2025 Financial Results

Seadrill Limited is a leading company in the deepwater oil and gas drilling sector, known for its modern fleet and advanced technologies. In its second quarter of 2025, Seadrill reported a net loss of $42 million but achieved an Adjusted EBITDA of $106 million, highlighting a significant improvement from the previous quarter. The company also announced new contract awards for its rigs, West Vela and Sevan Louisiana, in the U.S. Gulf, contributing to a robust order backlog of approximately $2.5 billion.