+ Watch SDRL
on My Watchlist
SDRL is attractive at 11% yield and expected upside of 50% over 2 years. Net 77% gain (21% CAGR). Concerns about offshore drilling for the near term are overblown and already priced in. SDRL marking a double-bottom near $32.50. Any new contracts will provide upside catalysts. Dividend is safe for 2014. Day rates are increasing - new contracts signed at competitors (Ensco, Noble) were for $550,000 - up 12-20% over prior contracts. With their young fleet and the market guaranteed to rebound over 2-4 years as Brazil and China get into the offshore market, the builds on spec will pay off handsomely.
This is a chart-based call. Homework to see if it's a good real-life entry point.
Best, newest, most high spec fleet in a growth industry that is experiencing a lull in demand short term.
SDRL is currently undervalued, trading at roughly 6.5 times earnings. It's been able to maintain >95% of its fleet under contract, plus most of its fleet is under contract until 2015 or later. The dividend is sustainable, and $2 billion of its debt has been paid down over the last year.
Assuming that CAPS correctly adjusts for dividends (I've always wondered about this), there's little doubt in my mind that Seadrill will outperform the market over the long term.
pent up demand - Departure of the OBOMINATION
sdrl has the youngest fleet and got caught in the oil companies mentioning of cutting back,(people are afraid of their debt) but that can only be for a little while once their reserves are low it's business as usual. since sdrl's fleet has the best tech it can still demand high day rates.even if not the div can be sustained on lower rates.imo.
Low p/e! High dividend! and great industry
at #33.00, with a 12% yield, and a P/E of 6, it seems a good value and a good risk...so long as it doesn't have any issue with the debt load.
How many CAPS points do I get when my "start price" is negative due to getting more than my start price back in dividends?
Short term panic on ultra-deep offshore oil drillers = long term opportunity for me.
Growth and yield. (Vodica)
Growth and yield.
need oil and more of it
Bottoming here. 10.7% dividend puts solid floor underneath.
Longer term: New $1.8 billion 6 yr contract w/Pemex. Bullish Short term pps benefit 1 to 6 weeks. upcoming quarterly report, Conference call, and anticipating dividend increase and announcement.
Tasty dividend is hard to ignore. I think the main driver however is the underlying demand for oil. Yea, I know, they have the youngest fleet in the industry, yada yada yada, but I own this stock for the dividend and I am green thumbing it today as I think it near the bottom of it's range and due for a rebound.
Short term prospects still good
On February 10, 2014 at 9:52 PM, awallejr (80.98) wrote: Welcome! I will give you a few: BBEP, AINV, PSEC, ARCC, WPZ, MMLP, SDRL.
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