In a recent analysis, BTIG's Gregory Lewis adjusted his target price for Seadrill (SDRL, Financial), cutting it from $50 to $28 while maintaining a Buy rating. This revision is part of a comprehensive report on the Energy sector. The report highlights that even though offshore drilling saw a rise in activity in April, the number of operating floaters decreased by one compared to the previous year. Additionally, challenges are expected to intensify as the summer approaches. The analysis suggests that offshore drilling will face sluggish performance over the coming year, with weakening pricing trends persisting.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 8 analysts, the average target price for Seadrill Ltd (SDRL, Financial) is $46.00 with a high estimate of $80.00 and a low estimate of $20.00. The average target implies an upside of 104.44% from the current price of $22.50. More detailed estimate data can be found on the Seadrill Ltd (SDRL) Forecast page.
Based on the consensus recommendation from 9 brokerage firms, Seadrill Ltd's (SDRL, Financial) average brokerage recommendation is currently 1.6, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
SDRL Key Business Developments
Release Date: February 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Seadrill Ltd (SDRL, Financial) returned over $500 million in capital to shareholders in 2024.
- The company added $1.3 billion in contracted backlog and divested non-core assets for $400 million.
- Seadrill Ltd (SDRL) has a strong balance sheet with $3 billion in durable contract cover extending through 2028 and into 2029.
- The company secured two long-term contract awards in Brazil, adding $1 billion in backlog.
- Seadrill Ltd (SDRL) has a share repurchase program that returned $792 million to shareholders, reducing issued share count by 22%.
Negative Points
- The market is softening in 2025 with some trade rivals offering lower day rates.
- Seadrill Ltd (SDRL) experienced 50 days of downtime for the West Taus due to regulatory matters in Brazil.
- The company is facing a $213 million claim from Petrobras related to past contracts.
- Fourth quarter results were adversely impacted by a reduction in operating days and planned out of service time.
- Seadrill Ltd (SDRL) incurred an uncharacteristically high amount of non-revenue days at the beginning of 2025.
