Seadrill defies expectations by raising dividend, outlook

Seadrill (SDRL) +1.3% premarket after increasing dividends and forecasting earnings to show "meaningful improvement” in Q2 and increase further for the rest of the year as utilization rates rise (Q1 results).

The dividend raise is a mere $0.02 (to an even $1.00) but SDRL had warned in February that it saw “limited value” in paying out more than $0.98 because of slowing growth in the rig market in 2014-15.

SDRL says the market still "suffers from limited exploration drilling and delays in field developments,” bit it has seen "increased inquiries” in recent weeks.

Q1 net income rose to $3.1B from $440M in the year-ago quarter on financial gains of $2.2B from the deconsolidation of Seadrill Partners; consolidated EBITDA was $788M, beating estimates of $740M.

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Comments (15)
  • Rich In The Heart
    , contributor
    Comments (48) | Send Message
    I'm enjoying it hitting new highs (in recent history), much less increasing the dividend to a rounded off dollar. That's just nice and easy to figure in one's dividend portfolio.
    28 May 2014, 08:39 AM Reply Like
  • Capt Jack Daniels
    , contributor
    Comments (1466) | Send Message
    One dollar is better than ninety-eight cents.


    Especially at current prices.
    28 May 2014, 09:36 AM Reply Like
  • Joenobody09
    , contributor
    Comments (66) | Send Message
    $1>$0.98 .
    LOL famous last word.
    28 May 2014, 10:15 AM Reply Like
  • Capt Jack Daniels
    , contributor
    Comments (1466) | Send Message
    That's better than what? my wallet?
    Yeah right...
    28 May 2014, 10:23 AM Reply Like
  • drjorde
    , contributor
    Comments (260) | Send Message
    Has anyone seen the date for this dividend yet?
    28 May 2014, 09:51 AM Reply Like
  • AdamDivy
    , contributor
    Comments (413) | Send Message
    It's in the pdf that was linked to an earlier SA post.


    Ex-Div on 6/10/14, Record on 6/12/14, Pay on 6/19/14
    28 May 2014, 10:23 AM Reply Like
  • Capt Jack Daniels
    , contributor
    Comments (1466) | Send Message
    The ex-dividend date has been set to June 10, 2014, record date is June 12, 2014 and payment date is on or about June 19, 2014.


    $1.00 a share.
    28 May 2014, 01:49 PM Reply Like
  • captainofindutry
    , contributor
    Comments (21) | Send Message
    To me sustaining the dividend for the long haul is more important than raising it for the near term.
    28 May 2014, 09:53 AM Reply Like
  • jbkemp
    , contributor
    Comments (9) | Send Message
    I like the dividend long term and I believe as China picks up... energy prices will go up and Sdrl income should stay up or go higher. But another spin off would throw a monkey wrench in the whole thing.
    28 May 2014, 10:19 AM Reply Like
  • gusrezo
    , contributor
    Comments (3) | Send Message
    from the Q1 report:
    *expected to allocate up to 9 rigs with Rosneft (positive)
    *expected competitors can accept lower daily rates in the range 425-475,000, down from more than 500,000 currently, as long as the major E&P companies delay their investment deccisions. (negative)


    cash-flow from operating activities:656 millions, dividends 459 millions.
    28 May 2014, 10:30 AM Reply Like
  • mapodga
    , contributor
    Comments (7581) | Send Message
    They can sustain this level of dividend.


    It is 10% yield. Based on real revenue and EPS, not some cooking balance sheet.


    Long SDRL
    28 May 2014, 11:12 AM Reply Like
  • sinedo
    , contributor
    Comments (501) | Send Message
    One solid indicator is the immediate "hit-piece" by SA author "Seeking Profits".
    He is famous for trying to push the Short position that his bosses have tried against most of the Oil producers. These guys are having fits over SDRL's rising stock performance since they tried to trash it. Fortunately, there are two or more authors ready to counter his pathetic attempt to scare income investors out.
    Don't reward him by reading his junk; SA authors get paid by the views. Besides, the quality is sadly inferior.
    28 May 2014, 11:27 AM Reply Like
  • Capt Jack Daniels
    , contributor
    Comments (1466) | Send Message
    Seeking profits will have to change to seeking to cover my ill advised shorts.


    Clean your shorts.


    :) like a big boy.


    With words like vaguely threatening and most likely isn't it not true, "S P" will have to change his stick to they are making too much money.
    28 May 2014, 11:38 AM Reply Like
  • Capt Jack Daniels
    , contributor
    Comments (1466) | Send Message
    Most people were expecting good results as well as a dividend raise and both results were announced with this quarter's results, don't let some poorly worded piece steer you wrong. The fact that seadrill only raised the dividend by 2% is comforting not defying expectations nor outlook.
    28 May 2014, 12:57 PM Reply Like
  • flowerseq
    , contributor
    Comments (51) | Send Message
    Agree with sindeo. Bret Jensen wrote a piece on them yesterday and it just added to the confirmation for me. He is long SDRL and so am I. I've read him for a long time and he is usually spot on, which I believe he was again. 10% or 11%, depending on where your basis is, is nothing to sneeze at and can carry profit through some ups and downs as rumors come and go. I agree that the day rate CAN come down for everyone, but other than that, there are so very few negatives to be found in this stock that it makes it a no-brainer, which makes me a highly qualified shareholder.
    28 May 2014, 10:46 PM Reply Like
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