# Seadrill (SDRL.US)

Canonical: https://gigainvestors.com/s/SDRL

Analysis as of: 2026-10-16T07:31:49.850Z. Financial observations: FY2018–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $46.29 per share; close as of 2026-10-15.

Estimated value: low $68.92 per share, central $77.74 per share, high $89.49 per share. Buy at or below the central value $77.74 per share. Valuation as of 2026-10-16T07:31:49.850Z; scenarios are not confidence intervals.

Expected annual return: 15.6% at the stated quote. About 15.6% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- more than 2 net loss years

- negative average operating margin

- operating margin variation exceeds 0.35

- Financial history: 9 years

- Years with declining revenue: 3

- Years with a net loss: 5

- Operating margin variation: 2.89×

Chart: Operating margin; fiscal year observations.

- FY2018: -0.30×

- FY2019: -0.21×

- FY2020: -4.66×

- FY2021: -0.17×

- FY2022: 0.08×

- FY2023: 0.22×

- FY2024: 0.30×

- FY2025: 0.05×

- LTM to Jun 2026: 0.09×

### moat: fail

- Years with nonpositive invested capital use equity plus debt and leases; positive earnings with no positive capital are shown above 100%.

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 4.6pp below the typical margin (limit 4pp)

- ROIC, median of available years: 0.9%

- ROIC, second-lowest year: -3.4%

- Typical minus recent gross margin: 4.6 pp

- Typical gross margin (annual median): 16.6%

- Recent gross margin (lower of latest and 3-year median): 12.0%

- Years with nonpositive capital: 1

- Capital spending / revenue: 6.7%

- ROIC including acquisitions, ten-year median: 1.6%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2018: -3.4%

- FY2019: -3.4%

- FY2020: -144.1%

- FY2021: 0.0%

- FY2022: 4.1%

- FY2023: 10.8%

- FY2024: 13.5%

- FY2025: 1.8%

### economics: pass

- Owner earnings / net income, 5-yr: 1.07×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $4.3B

- Net income, five-year total: $4.0B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -4.1 pp

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 0.83×

- FY2022: 1.00×

- FY2023: 1.18×

- FY2024: 1.02×

- FY2025: -0.66×

### management: pass

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: -3.4% vs 10.8%

- Per-share earnings: -44.83 to 4.05 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 5-year annual growth: -8.3%

- Diluted shares, 5-year annual growth: -8.3%

- Per-share value change: $48.88

- Per-share value, starting three-year median: -$44.83

- Per-share value, ending three-year median: $4.05

- Buybacks concentrated in cheaper years (correlation): 1.00

- Average buyback yield: 13.4%

- Buyback history: 2 years

- Debt-funded buybacks: Yes

- ROIC, first three-year median: -3.4%

- ROIC, last three-year median: 10.8%

Chart: Earnings per share; fiscal year observations.

- FY2018: -$44.83

- FY2019: -$12.19

- FY2020: -$46.59

- FY2021: -$5.87

- FY2022: $25.54

- FY2023: $4.05

- FY2024: $6.28

- FY2025: -$1.18

### accounting: pass

- Sloan accruals: -1.2%

- Receivables to sales index (DSRI): 0.63×

- Restructuring years, last five: 0

- Earnings backed by cash: Yes

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.00×

Chart: Sloan accruals; fiscal year observations.

- FY2018: -39.1%

- FY2019: -10.4%

- FY2020: -107.0%

- FY2021: -11.1%

- FY2022: 139.2%

- FY2023: 0.3%

- FY2024: 8.6%

- FY2025: -1.2%

## Holders

- [Matthew McLennan](https://gigainvestors.com/FE): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Samantha McLemore](https://gigainvestors.com/PTNT): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to shrink 6.2% a year for ten years · sales +5.8%

Story as of 2026-10-16T09:59:33.852Z; price observation 2026-10-15.

Price needs cash profits to shrink 6.2% a year for ten years

- 2025-07-18: Seadrill estimates liability up to $53 million after UK court ruling ([investing.com](https://www.investing.com/news/sec-filings/seadrill-estimates-liability-up-to-53-million-after-uk-court-ruling-93CH-4142650))

- 2026-01-23: Seadrill (SDRL) Is Up 8.2% After Securing New Offshore Contracts And Backlog Extensions ([finance.yahoo.com](https://finance.yahoo.com/news/seadrill-sdrl-8-2-securing-043516418.html))

- 2026-04-23: Seadrill Wins New Drillship Contracts, Drives Backlog Growth ([finance.yahoo.com](https://finance.yahoo.com/sectors/energy/articles/seadrill-wins-drillship-contracts-drives-145700625.html))

- 2026-08-10: Earnings Snapshot: Seadrill tops Q2 estimates across key metrics, raises FY26 outlook; extends buyback ([seekingalpha.com](https://seekingalpha.com/news/4629709-earnings-snapshot-seadrill-tops-q2-estimates-across-key-metrics-raises-fy26-outlook-extends-buyback?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

### Sales · FY2025–2026

sales +5.8%; source https://www.sec.gov/Archives/edgar/data/1737706/000173770626000010/sdrl-20251231.htm; observed 2026-02-26.

- FY2018: $1.2B 

- FY2019: $1.4B 

- FY2020: $961M 

- FY2021: $907M 

- FY2022: $936M 

- FY2023: $1.5B 

- FY2024: $1.4B 

- FY2025: $1.4B 

- FY2026: $1.5B 

### Gross margin · FY2025

gross margin 12%; source https://www.sec.gov/Archives/edgar/data/1737706/000173770626000010/sdrl-20251231.htm; observed 2026-02-26.

- FY2018: 32.4% 

- FY2022: 30.0% 

- FY2023: 38.4% 

- FY2024: 21.2% 

- FY2025: 12.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in oil & gas drilling; annual sales are USD 1.4 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1737706/000173770626000010/sdrl-20251231.htm (filed 2026-02-26); FY2025: revenue 1437000000; grossProfit 173000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); SDRL.US: Seadrill Limited provides offshore drilling services to the oil and gas industry worldwide. The company owns and operates floaters, such as drillships and semi-submersible rigs for operations in shallow and ultra-deep water in benign and harsh environments. It also offers jackup rigs, management services, and provides contracts drilling units to drill wells. It serves oil super-majors, state-owned national oil companies, and independent oil and gas companies. The company was formerly known as Seadrill 2021 Limited. Seadrill Limited was incorporated in 2005 and is based in Houston, Texas.

### Why customers stay

Margins ranged from 12% to 38.4% during 2023–25; it earns 0.9% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); FY2023: grossProfit / revenue = 38.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); FY2024: grossProfit / revenue = 21.2%.

- Source: https://www.sec.gov/Archives/edgar/data/1737706/000173770626000010/sdrl-20251231.htm (filed 2026-02-26); FY2025: grossProfit / revenue = 12%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); 8-year return on capital observations [[2018,-0.03377672209026128],[2019,-0.033575853623397205],[2020,-1.4407773707773708],[2021,0],[2022,0.041244304438319175],[2023,0.10751259215365042],[2024,0.13472858077174624],[2025,0.017656449553001278]]; median 0.008828224776500639. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid no dividends in 8 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); FY2022: growth capex 0; upkeep 149000000; owner earnings 3910000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); FY2023: growth capex 0; upkeep 101000000; cash acquisitions 0; owner earnings 354000000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); FY2024: growth capex 0; upkeep 157000000; cash acquisitions 0; owner earnings 457000000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/1737706/000173770626000010/sdrl-20251231.htm (filed 2026-02-26); FY2025: growth capex 0; upkeep 110000000; cash acquisitions 0; owner earnings 51000000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); Dividend observations: [[2018,0],[2019,0],[2020,0],[2021,0],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 0.6% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); SDRL.US SharesStats.PercentInsiders = 0.628 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits shrink 6.2% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-26); Ten-year compound average after fade. Initial solved rate -0.10007187813237978. Price 46.29; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03.  Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2022-06: $25.00 per share

- 2022-08: $28.00 per share

- 2022-09: $22.00 per share

- 2022-10: $31.50 per share

- 2022-11: $32.00 per share

- 2022-12: $32.64 per share

- 2023-01: $42.50 per share

- 2023-02: $41.53 per share

- 2023-03: $40.16 per share

- 2023-04: $36.38 per share

- 2023-05: $35.45 per share

- 2023-06: $41.27 per share

- 2023-07: $48.91 per share

- 2023-08: $48.65 per share

- 2023-09: $44.79 per share

- 2023-10: $39.52 per share

- 2023-11: $44.38 per share

- 2023-12: $47.28 per share

- 2024-01: $43.22 per share

- 2024-02: $42.20 per share

- 2024-03: $50.30 per share

- 2024-04: $48.55 per share

- 2024-05: $51.87 per share

- 2024-06: $51.50 per share

- 2024-07: $55.01 per share

- 2024-08: $43.12 per share

- 2024-09: $39.74 per share

- 2024-10: $39.35 per share

- 2024-11: $40.64 per share

- 2024-12: $38.93 per share

- 2025-01: $36.16 per share

- 2025-02: $25.47 per share

- 2025-03: $25.00 per share

- 2025-04: $20.54 per share

- 2025-05: $23.20 per share

- 2025-06: $26.25 per share

- 2025-07: $29.16 per share

- 2025-08: $31.91 per share

- 2025-09: $30.21 per share

- 2025-10: $31.56 per share

- 2025-11: $30.52 per share

- 2025-12: $34.60 per share

- 2026-01: $38.48 per share

- 2026-02: $43.88 per share

- 2026-03: $45.50 per share

- 2026-04: $49.69 per share

- 2026-05: $47.17 per share

- 2026-06: $37.82 per share

- 2026-07: $44.84 per share

- 2026-08: $48.72 per share

- 2026-09: $44.67 per share

- 2026-10: $46.29 per share

## Annual estimated value (USD per share)

- FY2024: low $57.69 per share, central $64.77 per share, high $74.19 per share

- FY2025: low $62.96 per share, central $70.99 per share, high $81.67 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1737706/000173770626000010/sdrl-20251231.htm); period 2025-12-31, filed 2026-02-26.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.