Trade-Ideas: Seadrill (SDRL) Is Today's Post-Market Leader Stock

Trade-Ideas LLC identified Seadrill (SDRL) as a post-market leader candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Seadrill

(

SDRL

) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Seadrill as such a stock due to the following factors:

  • SDRL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $61.7 million.
  • SDRL is up 4.2% today from today's close.

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More details on SDRL:

Seadrill Limited, an offshore drilling contractor, provides offshore drilling services to the oil and gas industry worldwide. The company operates through Floaters and Jack-up Rigs segments. SDRL has a PE ratio of 1. Currently there are 2 analysts that rate Seadrill a buy, 1 analyst rates it a sell, and 5 rate it a hold.

The average volume for Seadrill has been 12.4 million shares per day over the past 30 days. Seadrill has a market cap of $3.4 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.74 and a short float of 16.1% with 6.75 days to cover. Shares are down 42.7% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Seadrill as a

hold

. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The gross profit margin for SEADRILL LTD is rather high; currently it is at 61.55%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 33.04% significantly outperformed against the industry average.
  • Despite the weak revenue results, SDRL has outperformed against the industry average of 31.2%. Since the same quarter one year prior, revenues slightly dropped by 6.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Energy Equipment & Services industry and the overall market on the basis of return on equity, SEADRILL LTD has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • The debt-to-equity ratio of 1.10 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, SDRL maintains a poor quick ratio of 0.81, which illustrates the inability to avoid short-term cash problems.

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