Do Seadrill’s (SDRL) New Gulf and Angola Deals Quietly Recast Its Offshore Risk Profile?

• Earlier this week, Seadrill Limited announced new contract awards for the West Neptune and Sevan Louisiana in the U.S. Gulf of Mexico, alongside a five-well option exercise in Angola that keeps the Sonangol Quenguela working into February 2027 and adds about US$48 million to its backlog.
• These awards not only extend rig utilization across key basins but also highlight Seadrill’s ability to secure follow-on work and deploy new well-intervention technology in the Gulf of Mexico.
• We’ll now look at how this incremental backlog, especially the Angola extension, reshapes Seadrill’s investment narrative and risk profile.

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Seadrill Investment Narrative Recap

To own Seadrill, you need to believe that tightening ultra‑deepwater supply and rising offshore activity will eventually translate into stronger utilization, pricing, and cash flow, despite recent losses and volatile sentiment. The new contracts modestly support the near term utilization and backlog story, but do not fundamentally change the key near term catalyst, which is clearer evidence that day rates can hold up against softer utilization and competition, or the main risk of margin pressure into 2026.

Of the recent announcements, the Angola extension for the Sonangol Quenguela looks most relevant here, because it directly addresses the risk of idle time in a region where approvals and timelines have often slipped. Locking in work into February 2027 reduces near term revenue volatility for that rig and slightly improves backlog visibility, but it does not remove the broader concerns around weaker pricing power and Seadrill’s recent swing back into net losses.

Yet even with better backlog visibility, investors should be aware that...

Read the full narrative on Seadrill (it's free!)

Seadrill's narrative projects $1.6 billion revenue and $231.6 million earnings by 2028. This requires 7.2% yearly revenue growth and about a $154.6 million earnings increase from $77.0 million today.

Uncover how Seadrill's forecasts yield a $43.50 fair value, a 44% upside to its current price.

Exploring Other Perspectives

Five Simply Wall St Community valuations for Seadrill span about US$41.86 to US$474.73, highlighting how far apart individual views on upside really are. When you set that against ongoing concerns about softer utilization and day rate pressure through 2026, it becomes even more important to compare several of these perspectives before deciding what the recent contracts might mean for Seadrill’s longer term performance.

Explore 5 other fair value estimates on Seadrill - why the stock might be worth just $41.86!

Build Your Own Seadrill Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Seadrill research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Seadrill research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Seadrill's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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