Seadrill Limited (SDRL) AI Stock Analysis

• Market Cap: $1.47B
• Dividend Yield: N/A
• Average Volume (3M): 927.02K
• Price to Earnings (P/E): 4.4
• Beta (1Y): 1.16
• Revenue Growth: -15.60%
• EPS Growth: 32.51%
• Country: US
• Employees: 3,300
• Sector: Energy
• Sector Strength: 40
• Industry: Oil & Gas Drilling
• EPS (TTM): -0.23
• Shares Outstanding: 62,225,300
• 10 Day Avg. Volume: 689,762
• 30 Day Avg. Volume: 927,019
• PEG Ratio: 0.43
• Price to Book (P/B): 0.55
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -22.59
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $48.20
• Price Target Upside: 107.40% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 71 Outperform
• Price Target: $26.00 ▲( 11.88% Upside)

Seadrill Limited's stock score reflects its strong financial recovery and undervaluation, which make it a compelling investment despite challenges in revenue growth and global market uncertainties. The technical analysis suggests cautious optimism, while the mixed earnings call outlook highlights both opportunities and risks.

Positive Factors

Contract Pipeline

There is a robust pipeline of deepwater project approvals in 2026 and 2027, which would be more than double the project approvals in 2024 and 2025.

Financial Performance

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).

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 makes money primarily through contracts with major oil and gas companies for the use of its drilling rigs and services. The company secures long-term contracts, often ranging from several months to years, which provide a steady stream of revenue. Key revenue streams include day rates charged for the deployment of various types of drilling units, such as semi-submersibles, drillships, and jack-up rigs. These rates can vary based on the type of rig, location, duration, and market conditions. Additionally, Seadrill may engage in partnerships or joint ventures with other companies in the sector to expand its operational capabilities and market reach. The company's earnings are significantly influenced by factors such as global oil prices, exploration and production expenditures by oil companies, and the overall demand for offshore drilling services.

Seadrill Limited Financial Statement Overview

Summary

Seadrill Limited has shown strong profitability with improved gross and net profit margins. However, challenges persist in sustaining revenue growth and cash flow conversion, requiring efficient management of financial resources.

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
	EBIT
412.00M	329.00M	72.00M	-108.00M	-408.00M
	EBITDA
562.00M	494.00M	224.00M	-336.00M	-3.69B
	Net Income Common Stockholders
446.00M	300.00M	3.67B	-572.00M	-4.43B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
478.00M	697.00M	480.00M	375.00M	491.00M
	Total Assets
4.16B	4.22B	2.80B	2.90B	3.96B
	Total Debt
610.00M	608.00M	518.00M	908.00M	6.09B
	Net Debt
132.00M	-89.00M	38.00M	533.00M	5.60B
	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
88.00M	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: Negative
• Last Price: 23.24
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 23.24 is above the 20-day moving average (MA) of 22.91, above the 50-day MA of 22.76, and below the 200-day MA of 34.02, indicating a neutral trend. The MACD of 0.51 indicates Negative momentum. The RSI at 50.89 is Neutral, neither overbought nor oversold. The STOCH value of 23.09 is Neutral, 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
SDRL	71 Outperform	$1.47B	4.35	12.75%	―	-15.60%	32.51%
HP	66 Neutral	$1.60B	7.35	7.57%	8.32%	12.23%	-37.06%
HLX	66 Neutral	$980.40M	11.71	5.64%	―	0.34%	―
BORR	63 Neutral	$404.43M	5.17	8.30%	14.20%	30.97%	281.37%
RIG	60 Neutral	$2.25B	―	-6.65%	―	24.47%	-55.45%
Sector *	57 Neutral	$7.14B	3.33	-3.45%	5.75%	0.66%	-50.76%
SOC		$2.93B	―	-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.