Seadrill Limited (SDRL) AI Stock Analysis

• Market Cap: $1.69B
• Dividend Yield: N/A
• Average Volume (3M): 1.18M
• Price to Earnings (P/E): 5.4
• Beta (1Y): 1.09
• Revenue Growth: -15.60%
• EPS Growth: 32.51%
• Country: US
• Employees: 3,300
• Sector: Energy
• Sector Strength: 47
• Industry: Oil & Gas Drilling
• EPS (TTM): -0.23
• Shares Outstanding: 62,225,300
• 10 Day Avg. Volume: 1,735,289
• 30 Day Avg. Volume: 1,182,748
• PEG Ratio: >-0.01
• Price to Book (P/B): 0.96
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -11.89
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 0.29
• Enterprise Value/Gross Profit: 5.86
• Enterprise Value/Ebitda: 1.00
• 1Y Price Target: $48.00
• Price Target Upside: 65.63% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 71 Outperform
• Price Target: $30.00 ▲(3.52%Upside)

Seadrill's strong financial stability, attractive valuation, and positive technical indicators contribute significantly to its overall score. Challenges from declining revenue and market uncertainties noted in the earnings call slightly temper the outlook. The absence of significant corporate events keeps the focus on financial performance and valuation.

Positive Factors

Contract Backlog

Added $1bn in contract backlog.

Earnings

SDRL reported first quarter revenue of $335 million compared to the estimate of $281 million.

Market Demand

Pricing for 7G drillships has held firm in the mid-to-high $400k/day range, indicating strong market demand.

Negative Factors

Contract Activity

The lack of contract activity so far in the year could be a near-term headwind for Seadrill (SDRL).

Lawsuits

SDRL is involved in a lawsuit with SFL Hercules that resulted in being ordered to pay $48 million.

Operational Delays

SDRL disclosed a delay in West Polaris beginning planned work in Brazil and the West Tellus being offline for 50 days, which would have material impact on first quarter results.

Seadrill Limited Business Overview & Revenue Model

Company Description

Seadrill Limited provides offshore contract drilling services to the oil and gas industry worldwide. It operates in three segments: Harsh Environment, Floaters, and Jack-ups Rigs. The company owns and operates drillships, semi-submersible rigs, and jack-up rigs for operations in shallow and ultra-deep-water in benign and harsh environments. It offers operation support and management services to third parties, as well as related and non-related companies. As of April 8, 2022, the company owned a fleet of 21 offshore drilling units consisting of two harsh-environment rigs, two benign-environment semi-submersible rigs, six drill-ships, and 11 jack-up rigs. It serves oil super-majors, state-owned national oil companies, and independent oil and gas companies. Seadrill Limited was incorporated in 2005 and is headquartered in London, the United Kingdom.

How the Company Makes Money

Seadrill Limited generates revenue primarily through the leasing and operation of its offshore drilling rigs to oil and gas exploration and production companies. The company enters into contracts with these companies to provide drilling services, which can be short-term or long-term depending on the project requirements. Revenue is earned based on daily rates charged for the use of its rigs, which vary depending on the rig type, location, and market conditions. Additionally, Seadrill may earn income through partnerships or joint ventures with other companies in the offshore drilling sector, as well as through ancillary services such as well maintenance and management. Key factors affecting Seadrill's earnings include global oil prices, demand for offshore drilling, and operational efficiency.

Seadrill Limited Financial Statement Overview

Summary

Seadrill Limited has demonstrated robust profitability recovery and financial stability 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	1.34B	1.39B	1.47B	977.00M	840.00M	894.00M
Gross Profit	285.00M	293.00M	565.00M	277.00M	54.00M	-37.00M
EBITDA	326.00M	562.00M	494.00M	224.00M	-336.00M	-3.69B
Net Income	372.00M	446.00M	300.00M	3.67B	-572.00M	-4.43B
Balance Sheet
Total Assets	4.06B	4.16B	4.22B	2.80B	2.90B	3.96B
Cash, Cash Equivalents and Short-Term Investments	404.00M	478.00M	697.00M	480.00M	375.00M	491.00M
Total Debt	618.00M	618.00M	608.00M	518.00M	908.00M	6.09B
Total Liabilities	1.16B	1.24B	1.24B	1.10B	1.34B	7.10B
Stockholders Equity	2.91B	2.92B	2.98B	1.70B	1.56B	-3.14B
Cash Flow
Free Cash Flow	-147.00M	-69.00M	186.00M	-137.32M	-183.00M	-447.00M
Operating Cash Flow	32.00M	88.00M	287.00M	8.83M	-154.00M	-420.00M
Investing Cash Flow	200.00M	226.00M	42.00M	336.42M	37.00M	-32.00M
Financing Cash Flow	-413.00M	-532.00M	-200.00M	-356.04M	0.00	-163.00M

Seadrill Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 28.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SDRL, the sentiment is Positive. The current price of 28.98 is above the 20-day moving average (MA) of 27.07, above the 50-day MA of 24.60, and below the 200-day MA of 31.73, indicating a neutral trend. The MACD of 0.70 indicates Positive momentum. The RSI at 66.83 is Neutral, neither overbought nor oversold. The STOCH value of 54.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SDRL.

Seadrill Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	76 Outperform	€12.58B	14.51	12.55%	5.09%	3.28%	-1.80%
SDRL	71 Outperform	$1.69B	5.43	12.75%	―	-15.60%	32.51%
HLX	71 Outperform	$972.82M	11.97	5.64%	―	0.34%	―
HP	69 Neutral	$1.58B	7.26	7.57%	6.28%	12.23%	-37.06%
BORR	65 Neutral	$466.65M	9.69	5.17%	4.10%	19.15%	15.37%
RIG	60 Neutral	$2.35B	―	-6.65%	―	24.47%	-55.45%
SOC		$2.11B	―	-200.53%	―	―	―

Seadrill Limited Corporate Events

Seadrill Limited Approves Key Proposals at AGM

At the Annual General Meeting of Shareholders held on May 14, 2025, Seadrill Limited addressed several key proposals. The meeting resulted in the approval of setting the number of directors at up to nine, the re-election of several directors, the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm, and the approval of director remuneration and executive compensation policies. Additionally, it was decided that advisory votes on executive compensation will be held annually.

The most recent analyst rating on (SDRL) stock is a Buy with a $73.00 price target. To see the full list of analyst forecasts on Seadrill Limited stock, see the SDRL Stock Forecast page.