SDRL for high dividend yield
Posted: Mon Jul 01, 2013 9:47 am
Seadrill Ltd. (SDRL) is in our High Yield Income Portfolio. The current dividend yield is approximately 8.6%.
Note below from Morgan Stanley's weekly Global Oilfield Services report.
"Offshore drilling market is likely to tighten further, allowing rig rates to remain robust around current levels. Meeting with the Fredriksen Group highlighted the lack of near-term deepwater availability and an expected pickup in floater and jackup backlogs in the coming months. Decreasing drilling efficiencies and upcoming field development requirements should provide a backdrop for SDRL to build more rigs and grow its dividend at a fast clip of ~10% / annum. Meanwhile Seadrill expects to maintain its dayrates at the current levels, as it believes rates north of $700kpd could trigger operators to build their own rigs."
Note below from Morgan Stanley's weekly Global Oilfield Services report.
"Offshore drilling market is likely to tighten further, allowing rig rates to remain robust around current levels. Meeting with the Fredriksen Group highlighted the lack of near-term deepwater availability and an expected pickup in floater and jackup backlogs in the coming months. Decreasing drilling efficiencies and upcoming field development requirements should provide a backdrop for SDRL to build more rigs and grow its dividend at a fast clip of ~10% / annum. Meanwhile Seadrill expects to maintain its dayrates at the current levels, as it believes rates north of $700kpd could trigger operators to build their own rigs."