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Credit Suisse Lowers Seadrill Price Target

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On Wednesday, analysts at Credit Suisse lowered the price target on shares of Seadrill Ltd (NYSE: SDRL) from $30 to $20 and maintained a Neutral rating.

Gregory Lewis finds the company is preparing for an extended downcycle; consequently the company had to suspend its dividend.

"With the stock yielding 20% on the previous $4 targeted annual dividend, confidence in the dividend was lacking to say the least. We believe the decision to eliminate the dividend also represents a changing of the guard. We expect a more conservatively run, less leveraged business."

Moreover, "other less leveraged drillers are committed to their dividends and have the capacity to pay them. The old adage getting paid to wait matters and while SDRL should reinstate a dividend at some point, the cycle probably needs to turn for that to happen – no time soon."

Shares of Seadrill were down more than 6 percent Friday morning.

Latest Ratings for SDRL

DateFirmActionFromTo
Aug 2019BTIG ResearchDowngradesBuyNeutral
Oct 2018BTIG ResearchInitiates Coverage OnBuy
Jul 2016Morgan StanleyDowngradesOverweightEqual-Weight

View More Analyst Ratings for SDRL
View the Latest Analyst Ratings

 

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Posted-In: Credit Suisse Gregory LewisAnalyst Color Price Target Analyst Ratings

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