Loading...

SeaDrill

NYSE:SDRL
Snowflake Description

Overvalued with worrying balance sheet.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
SDRL
NYSE
$135M
Market Cap
  1. Home
  2. US
  3. Energy
2018/02/24
Company description

Seadrill Limited, an offshore drilling contractor, provides offshore drilling services to the oil and gas industry worldwide. More info.


Add to Portfolio Compare Print Invest
SHARE PRICE
3 Month History
SDRL
Industry
5yr Volatility vs Market

Value

 Is SeaDrill undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
  • It is not possible to calculate the future cash flow value for SeaDrill. This is due to cash flow or dividend data being unavailable. The share price is $0.263.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for SeaDrill's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are SeaDrill's earnings available for a low price, and how does this compare to other companies in the same industry?
  • SeaDrill is loss making, we can't compare it's value to the US Energy Services industry average.
  • SeaDrill is loss making, we can't compare the value of its earnings to the US market.
Price based on expected Growth
Does SeaDrill's expected growth come at a high price?
  • SeaDrill is loss making, we can't assess if its growth is good value.
Price based on value of assets
What value do investors place on SeaDrill's assets?
  • SeaDrill is good value based on assets compared to the US Energy Services industry average.
X
Value checks
We assess SeaDrill's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Energy Services industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Energy Services industry average (and greater than 0)? (1 check)
  5. SeaDrill has a total score of 1/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.
    Note 2: PEG ratio is based on analysts EPS growth expectations in 1 year (69.32%).

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is SeaDrill expected to perform in the next 1 to 3 years based on estimates from 9 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
-10.6%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is SeaDrill expected to grow at an attractive rate?
  • Unable to compare SeaDrill's earnings growth to the low risk savings rate as it is expected to be loss making during the next 1-3 years.
Growth vs Market Checks
  • Unable to compare SeaDrill's earnings growth to the US market average as it is expected to be loss making during the next 1-3 years.
  • SeaDrill's revenues are expected to decrease over the next 1-3 years, this is below the US market average.
Annual Growth Rates Comparison
Analysts growth expectations
Super high growth metrics
High Growth Checks
  • SeaDrill is not considered high growth as it is expected to be loss making for the next 1-3 years.
  • SeaDrill's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Unable to establish if SeaDrill will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess SeaDrill's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the US market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the US market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
SeaDrill has a total score of 0/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has SeaDrill performed over the past 5 years?

  • SeaDrill's last earnings update was 239 days ago.
The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare SeaDrill's growth in the last year to its industry (Energy Services).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • SeaDrill does not make a profit even though their year on year earnings growth rate was positive over the past 5 years.
  • Unable to compare SeaDrill's 1-year earnings growth to the 5-year average as it is not currently profitable.
  • Unable to compare SeaDrill's 1-year growth to the US Energy Services industry average as it is not currently profitable.
Earnings and Revenue History
SeaDrill's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • It is difficult to establish if SeaDrill has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) as it is loss-making.
  • It is difficult to establish if SeaDrill has efficiently used its assets last year compared to the US Energy Services industry average (Return on Assets) as it is loss-making.
  • SeaDrill's use of capital has not improved over the past 3 years (Return on Capital Employed).
X
Past performance checks
We assess SeaDrill's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Energy Services industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
SeaDrill has a total score of 0/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is SeaDrill's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up SeaDrill's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • SeaDrill's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
  • SeaDrill's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of SeaDrill's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is not covered by short term assets, assets are 0.3x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
  • SeaDrill's level of debt (95.5%) compared to net worth is high (greater than 40%).
  • The level of debt compared to net worth has been reduced over the past 5 years (165.1% vs 95.5% today).
  • Debt is not well covered by operating cash flow (8.5%, less than 20% of total debt).
  • Interest payments on debt are not well covered by earnings (EBIT is 1.3x annual interest expense, ideally 3x coverage).
X
Financial health checks
We assess SeaDrill's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by short term assets? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. SeaDrill has a total score of 1/6, see the detailed checks below.


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is SeaDrill's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0%
Current annual income from SeaDrill dividends.
If you bought $2,000 of SeaDrill shares you are expected to receive $0 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Unable to evaluate SeaDrill's dividend against the low risk savings benchmark as the company has not reported any payouts.
  • Unable to evaluate SeaDrill's dividend against the market benchmark as the company has not reported any payouts.
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
  • Unable to perform a dividend volatility check as SeaDrill has not reported any payouts.
  • Unable to verify if SeaDrill's dividend has been increasing as the company has not reported any payouts.
Current Payout to shareholders
What portion of SeaDrill's earnings are paid to the shareholders as a dividend.
  • Unable to calculate sustainability of dividends as SeaDrill has not reported any payouts.
Future Payout to shareholders
  • Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.
X
Income/ dividend checks
We assess SeaDrill's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.5%) - if not then the rest of the checks are ignored.
  2. Current dividend yield, is there one at all, is it higher than the low risk savings rate, and is it above the top 25% of dividend payers? (2 checks)
  3. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  4. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  5. How sustainable is the dividend, can SeaDrill afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  6. SeaDrill has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of SeaDrill's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Anton Dibowitz, image provided by Google.
Anton Dibowitz
AGE 45
TENURE AS CEO 0.6 years
CEO Bio

Mr. Anton Dibowitz has been Chief Executive Officer of Seadrill Management Ltd at SeaDrill Limited since July 1, 2017. Mr. Dibowitz served as the Chief Commercial Officer and Executive Vice President of Seadrill Ltd until July 1, 2017. Mr. Dibowitz served as an Executive Vice President of Seadrill Management Ltd. from June 6, 2016 to July 1, 2017. Mr. Dibowitz has 20 years drilling industry experience, Deepwater Western Hemisphere Division, since joining Seadrill in April 2007. He served as the Chief Commercial Officer and Senior Vice President of Seadrill Management Limited since January 2013 until June 6, 2016. He served as Vice President of Marketing at Seadrill Management AS since January 2010. Prior to Seadrill, Mr. Dibowitz held various positions within tax, process reengineering and marketing at Transocean and within tax services at Ernst & Young LLP. Mr. Dibowitz is a Certified Public Accountant and a graduate of the University of Texas at Austin where he received a Bachelor degree in Business Administration and master degrees in Professional Accounting and Business Administration (MBA).

CEO Compensation
  • Insufficient data for Anton to compare compensation growth.
  • Insufficient data for Anton to establish whether their compensation is reasonable for a company of this size and profit level.
Management Team Tenure

Average tenure and age of the SeaDrill management team in years:

3.9
Average Tenure
52.8
Average Age
  • The tenure for the SeaDrill management team is about average.
Management Team

John Fredriksen

TITLE
Chairman of the Board & President of Seadrill Management Ltd
AGE
73

Anton Dibowitz

TITLE
Chief Executive Officer of Seadrill Management Ltd
AGE
45
TENURE
0.6 yrs

Mark Morris

TITLE
CFO of Seadrill Management Ltd and SVP of Seadrill Management Ltd
AGE
53
TENURE
2.4 yrs

Georgina Sousa

TITLE
Company Secretary and Director
AGE
66
TENURE
12 yrs

Leif Nelson

TITLE
COO of Seadrill Management Ltd and SVP of Seadrill Management Ltd
AGE
42
TENURE
2.6 yrs

David Sneddon

TITLE
Chief Accounting Officer of Seadrill Management Ltd and SVP of Seadrill Management Ltd
AGE
53
TENURE
4.2 yrs

Henrik Hansen

TITLE
Chief Technical Officer of Seadrill Management Ltd and SVP of Seadrill Management Ltd
AGE
54
TENURE
2.6 yrs

John Roche

TITLE
Investor Relations Director
AGE
37

Chris Edwards

TITLE
Senior Vice President of Seadrill Management Ltd and General Counsel of Seadrill Management Ltd
AGE
52
TENURE
3 yrs

Iain Cracknell

TITLE
Director of Communications for Seadrill Management Ltd
Board of Directors Tenure

Average tenure and age of the SeaDrill board of directors in years:

4.4
Average Tenure
58.8
Average Age
  • The tenure for the SeaDrill board of directors is about average.
Board of Directors

John Fredriksen

TITLE
Chairman of the Board & President of Seadrill Management Ltd
AGE
73
TENURE
12.8 yrs

Georgina Sousa

TITLE
Company Secretary and Director
AGE
66
TENURE
2.3 yrs

David Weinstein

TITLE
Independent Director
AGE
58
TENURE
1.1 yrs

Kate Blankenship

TITLE
Independent Director
AGE
52
TENURE
12.8 yrs

Per Wullf

TITLE
Director
AGE
57
TENURE
2 yrs

Paul Leand

TITLE
Independent Director
AGE
51
TENURE
4.8 yrs

Hans Aas

TITLE
Independent Director
AGE
71
TENURE
2.8 yrs

Mark Grant

TITLE
Independent Director
AGE
63
TENURE
1.1 yrs

Harald Thorstein

TITLE
Director
AGE
38
TENURE
0.2 yrs
Recent Insider Trading
  • No 3 month insider trading information.
Who owns this company?
X
Management checks
We assess SeaDrill's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap and profit (greater than 0.5% of the company's profit + 0.03% of market cap)? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. SeaDrill has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

Company News

External News
Loading...
Simply Wall St News

What You Must Know About SeaDrill Limited's (NYSE:SDRL) Major Investors

Today, I will be analyzing SeaDrill Limited’s (NYSE:SDRL) recent ownership structure, an important but not-so-popular subject among individual investors. … Private Company Ownership Another important group of owners for potential investors in SDRL are private companies that hold a stake of 5.08% in SDRL. … Thus, potential investors should look into these business relations and check how it can impact long-term shareholder returns.What this means for you: Institutional ownership in SDRL is not at a level that would concern investors.

Simply Wall St -

Should Your Next Investment In The Energy Industry Be In SeaDrill Limited (NYSE:SDRL)?

Below, I will examine the sector growth prospects, as well as evaluate whether SeaDrill is lagging or leading its competitors in the industry. … NYSE:SDRL Past Future Earnings Jan 19th 18 The oil price collapse drove a negative 40% growth in the energy sector in the past five years. … If SeaDrill has been on your watchlist for a while, now may be the time to enter into the stock, if you like its growth prospects and are not highly concentrated in the oil and gas industry.

Simply Wall St -

SeaDrill Limited (NYSE:SDRL): Risks You Need To Consider Before Buying

A popular measure of market risk for a stock is its beta, and the market as a whole represents a beta value of one. … View our latest analysis for SeaDrill An interpretation of SDRL's beta With a beta of 3.05, SeaDrill is a stock that tends to experience more gains than the market during a growth phase and also a bigger reduction in value compared to the market during a broad downturn. … SDRL, with its market capitalisation of $131.66M, is a small-cap stock, which generally have higher beta than similar companies of larger size.

Simply Wall St -

SeaDrill Limited (NYSE:SDRL): Has Recent Earnings Growth Beaten Long-Term Trend?

Today I will take you through a basic sense check to gain perspective on how SeaDrill is doing by evaluating its latest earnings with its longer term trend as well as its industry peers' performance over the same period. … I use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. … The most insightful step is to assess company-specific issues SeaDrill may be facing and whether management guidance has dependably been met in the past.

Simply Wall St -

Is It Too Late To Buy SeaDrill Limited (NYSE:SDRL)?

I find that SeaDrill’s ratio of 0.01x is trading slightly below its industry peers’ ratio of 1.6x, which means if you buy SeaDrill today, you’d be paying a relatively reasonable price for it. … And if you believe SeaDrill should be trading in this range, then there isn’t much room for the share price grow beyond what it’s currently trading. … However, the positive outlook is encouraging for SeaDrill, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Simply Wall St -

Are SeaDrill Limited's (NYSE:SDRL) Interest Costs Too High?

With this reduction in debt, SDRL currently has $1,478.0M remaining in cash and short-term investments for investing into the business. … Moreover, SDRL has produced cash from operations of $1,184.0M during the same period of time, resulting in an operating cash to total debt ratio of 0.12x, meaning that SDRL’s debt is not appropriately covered by operating cash. … SDRL's large debt ratio on top of low cash coverage of debt in addition to low liquidity coverage of short-term obligations may not build the strongest investment case.

Simply Wall St -

Company Info

Map
Description

Seadrill Limited, an offshore drilling contractor, provides offshore drilling services to the oil and gas industry worldwide. The company operates through three segments: Floaters, Jack-up Rigs, and Other. The Floaters segment provides drilling, completion, and maintenance services for offshore exploration and production wells. Its drilling contracts relates to semi-submersible rigs and drillships for harsh and benign environments in mid, deep, and ultra-deep waters. The Jack-up Rigs segment offers various services, such as drilling, completion, and maintenance of offshore exploration and production wells. This segment’s drilling contracts relate to jack-up rigs for operations in harsh and benign environment. The Other segment provides management services to third parties. As of April 21, 2017, the company had a fleet of 38 offshore drilling units that consisted of 12 semi-submersible rigs, 7 drillships, and 19 jack-up rigs. It serves oil and gas exploration and production companies comprising integrated oil companies, government-owned oil companies, and independent oil and gas producers. Seadrill Limited was founded in 2005 and is headquartered in Hamilton, Bermuda. On September 12, 2017, SeaDrill Limited, along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.

Details
Name: SeaDrill Limited
SDRL
Exchange: NYSE
Founded: 2005
$135,191,067
504,444,280
Website: http://www.seadrill.com
Address: SeaDrill Limited
Par-la-Ville Place,
4th Floor,
Hamilton,
HM 08,
Bermuda
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NYSE SDRL Common Shares New York Stock Exchange US USD 31. May 2005
DB S9A Common Shares Deutsche Boerse AG DE EUR 31. May 2005
XTRA S9A Common Shares XETRA Trading Platform DE EUR 31. May 2005
LSE 0HYK Common Shares London Stock Exchange GB NOK 31. May 2005
OB SDRL Common Shares Oslo Bors NO NOK 31. May 2005
BATS-CHIXE SDRLO Common Shares BATS 'Chi-X Europe' GB NOK 31. May 2005
Number of employees
Current staff
Staff numbers
5,196
SeaDrill employees.
Industry
Oil and Gas Drilling
Energy
Company Analysis and Financial Data Status
Area Date
Company Analysis updated: 2018/02/24
Last estimates confirmation: 2018/01/18
Last earnings update: 2017/06/30
Last annual earnings update: 2016/12/31


All dates in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.