Seadrill Limited (SDRL) AI Stock Analysis

• Market Cap: $1.88B
• Dividend Yield: N/A
• Average Volume (3M): 1.17M
• Price to Earnings (P/E): 5.7
• Beta (1Y): 1.07
• Revenue Growth: -15.60%
• EPS Growth: 32.51%
• Country: US
• Employees: 3,300
• Sector: Energy
• Sector Strength: 45
• Industry: Oil & Gas Drilling
• EPS (TTM): -0.23
• Shares Outstanding: 62,225,300
• 10 Day Avg. Volume: 687,176
• 30 Day Avg. Volume: 1,169,229
• PEG Ratio: -0.30
• Price to Book (P/B): 0.61
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -12.11
• Enterprise Value/Market Cap: 1.06
• Enterprise Value/Revenue: 0.35
• Enterprise Value/Gross Profit: 7.00
• Enterprise Value/Ebitda: 1.19
• 1Y Price Target: $49.67
• Price Target Upside: 62.16% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 71 Outperform
• Price Target: $30.00 ▼(-2.06%Downside)

Seadrill's overall score reflects strong financial performance and attractive valuation, offset by legal challenges and mixed earnings call sentiment. Positive technical indicators contribute to the outlook, but the court judgment tempers the overall enthusiasm.

Positive Factors

Contract Backlog

Added $1bn in contract backlog.

Financial Performance

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

Share Repurchase Strategy

The company views share repurchases as a better use of cash than buying assets, suggesting confidence in the company's value.

Negative Factors

Industry Headwinds

Seadrill (SDRL) laid on several negative developments to the business in addition to the Company facing the same industry headwinds as its peers.

Legal Challenges

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 exhibits strong profitability and a stable financial position with a significant recovery in margins and a solid equity position. However, challenges like declining revenue and inconsistent cash flow conversion need attention.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.39B	1.47B	977.00M	840.00M	894.00M
Gross Profit	293.00M	565.00M	277.00M	54.00M	-37.00M
EBITDA	562.00M	494.00M	224.00M	-336.00M	-3.69B
Net Income	446.00M	300.00M	3.67B	-572.00M	-4.43B
Balance Sheet
Total Assets	4.16B	4.22B	2.80B	2.90B	3.96B
Cash, Cash Equivalents and Short-Term Investments	478.00M	697.00M	480.00M	375.00M	485.00M
Total Debt	618.00M	610.00M	518.00M	908.00M	6.09B
Total Liabilities	1.24B	1.24B	1.10B	1.34B	7.10B
Stockholders Equity	2.92B	2.98B	1.70B	1.56B	-3.14B
Cash Flow
Free Cash Flow	-69.00M	186.00M	-137.32M	-183.00M	-447.00M
Operating Cash Flow	88.00M	287.00M	8.83M	-154.00M	-420.00M
Investing Cash Flow	226.00M	42.00M	336.42M	37.00M	-32.00M
Financing Cash Flow	-532.00M	-200.00M	-356.04M	0.00	-163.00M

Seadrill Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 30.63
• 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 30.63 is above the 20-day moving average (MA) of 28.82, above the 50-day MA of 26.86, and below the 200-day MA of 30.91, indicating a neutral trend. The MACD of 0.79 indicates Positive momentum. The RSI at 61.30 is Neutral, neither overbought nor oversold. The STOCH value of 65.66 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
SDRL	71 Outperform	$1.88B	5.69	12.75%	―	-15.60%	32.51%
Sector *	67 Neutral	$15.28B	9.73	6.25%	5.18%	4.49%	-71.88%
HP	64 Neutral	$1.70B	7.78	7.57%	6.96%	12.23%	-37.06%
RIG	63 Neutral	$2.73B	―	-6.65%	―	24.47%	-55.45%
BORR	63 Neutral	$577.71M	10.79	5.17%	10.76%	19.15%	15.37%
HLX	59 Neutral	$1.05B	21.52	3.27%	―	-8.19%	―

Seadrill Limited Corporate Events

Seadrill Limited Faces $53 Million Court Judgment

In a recent legal development, Seadrill Limited was ordered by the High Court of Justice in England and Wales to pay damages to a claimant for a breach of contract related to negotiations in 2018 and 2019. The judgment, rendered on July 11, 2025, could result in a liability of up to $53 million for Seadrill, excluding potential legal fees. The company is considering its options, including a possible appeal, and anticipates a $10 million impact on its Adjusted EBITDA for the year 2025.

The most recent analyst rating on (SDRL) stock is a Buy with a $46.00 price target. To see the full list of analyst forecasts on Seadrill Limited stock, see the SDRL Stock Forecast page.

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.