This Could Be Seadrill's Path To Recovery - Seadrill (NYSE:SDRL)

In a report published Monday, Deutsche Bank analysts maintained their Hold rating on

SeaDrill Limited SDRL. The price target has also been maintained at $14. The analysts believe that the company has a robust game plan, which could ensure long term solvency without the need for equity issuance. According to the analysts, "Liquidity needs are relatively modest for this year and next and management is cultivating a number of longer-term options under a range of scenarios including a prolonged downturn with little/ no access to capital markets." Despite long-term value, given the lackluster outlook for offshore drilling and the limited catalysts for SeaDrill in the near term, the rating has been maintained. While newbuild supply has been seeing growth, incremental floater demand has been almost absent. SeaDrill expects incremental rig demand in 2H15, which will only bear fruit in 2016. The analysts have therefore revised their EPS estimates for 2015 and 2016 downward, from $2.50 to $2.44 and from $1.60 to $1.50, respectively.

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