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Contracts With Equinor Will Keep Rigs Operational But Analysts Expect Lower Earnings

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SHLF
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AnalystConsensusTarget
AnalystConsensusTarget
Not Invested
Published 19 Jan 2025

Update shared on30 Jul 2025

Fair value Decreased 19%
Previous
AnalystConsensusTarget's Fair Value
NOK 7.31
87.4% overvalued intrinsic discount
30 Jul
NOK 13.70
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1Y
-31.1%
7D
45.0%

Consensus price targets for Shelf Drilling have been sharply revised downward as analysts now expect contracting revenues and significantly weaker earnings, resulting in a much higher forward P/E and a new fair value estimate of NOK7.31.


What's in the News


  • Secured a one-year contract extension for the Key Manhattan jack-up rig, adding approximately USD 29 million in value and extending commitment until November 2026 with an additional one-year option.
  • Received a three-year contract award for the J.T. Angel jack-up rig from ONGC for operations offshore India, with a total added value of approximately USD 40 million; operations expected to commence in October 2025.
  • Announced disposal of the Trident XII rig, which completed its contract with ONGC and is currently stacked in India; intended sale is for non-drilling purposes.
  • Secured a five-year extension for the High Island V jack-up rig, adding approximately USD 133 million in contract value and extending commitment until July 2030.

Valuation Changes


Summary of Valuation Changes for Shelf Drilling

  • The Consensus Analyst Price Target has significantly fallen from NOK9.00 to NOK7.31.
  • The Consensus Revenue Growth forecasts for Shelf Drilling has significantly fallen from 0.1% per annum to -2.7% per annum.
  • The Future P/E for Shelf Drilling has significantly risen from 5.43x to 100.29x.

Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.