BMO Capital Markets upgraded Seadrill (NYSE:SDRL) to Market Perform from Underperform. BMO noted that SDRL was undervalued and increased its price target to $44/share from $32/share. While not a full-fledged endorsement of SDRL, this upgrade reflects the appreciation potential of SDRL shares.
While this upgrade was not specifically anticipated, given SDRL's earnings potential, it is reasonable to expect analysts to revise their price targets upwards. Catalysts for upgrades and price revisions could include the positive impact (on SDRL) of the current geo-political situation as well as news with respect to contracts and day rates.
This upgrade does not change, and in fact reinforces, my positive outlook with respect to SDRL shares.
Disclosure: The author is long SDRL. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.