Seadrill's muted outlook prompts Nomura downgrade, but Barclays sees dividend as "rock solid"

|About: Seadrill Limited (SDRL)|By:, SA News Editor

Seadrill (SDRL +1.8%), more than other offshore drillers, depends largely on its big dividend for investor support, which has sparked consternation over speculation of a dividend cut, but the safety of the dividend isn't the reason Nomura is downgrading SDRL shares to Neutral from Buy.

Despite SDRL's solid Q4 results and strong utilization, the firm is troubled by SDRL's relatively muted outlook for the deepwater drilling market in 2014 and highlighting for the first time a limited scope to increase the quarterly dividend.

However, Barclays calls SDRL's dividend "rock solid," encouraged by the $0.03/share raise to $0.98 as it reflects the company's operational improvements, solid order backlog and support received from financing markets.