Why Seadrill (SDRL) Is Up 11.4% After Securing US$235 Million In New Offshore Contracts

• Seadrill Limited announced in January 2026 that it had secured new offshore contracts for the West Capella in Malaysia, West Elara in Norway and an extension for West Carina in Brazil, together adding about US$235 million in firm-term contract value and options-linked upside.
• Beyond the headline value, these fixtures lengthen Seadrill’s revenue visibility into 2026–2027 across three key offshore regions, highlighting how contract coverage supports operational planning and earnings stability.
• We’ll now look at how this expanded multi-year, multi-region contract backlog reshapes Seadrill’s investment narrative and risk-reward balance.

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What Is Seadrill's Investment Narrative?

To own Seadrill today, you have to believe in the durability of offshore activity and the company’s ability to convert its growing backlog into consistent, cash-generating work despite recent thin margins and a high earnings multiple. The new West Capella, West Elara and West Carina fixtures directly support that thesis by adding about US$235 million of firm revenue into 2026–2027 and tightening near term visibility around one of the key bullish catalysts: higher utilization on modern rigs following the large West Jupiter award. Given the stock’s double digit move over the past month, this latest news looks material for sentiment, reinforcing the idea of improving contract coverage rather than transforming the story outright. The bigger swing factors remain execution on these contracts, dayrate quality and any setback to offshore spending.

However, investors also need to weigh Seadrill’s currently thin profitability and premium earnings multiple. Seadrill's shares have been on the rise but are still potentially undervalued. Find out how large the opportunity might be.

Exploring Other Perspectives

Five Simply Wall St Community fair value views span roughly US$44 to a very large US$377 per share, underscoring how differently people frame Seadrill’s potential against its improving backlog and still-fragile profitability profile.

Explore 5 other fair value estimates on Seadrill - why the stock might be worth just $43.50!

Build Your Own Seadrill Narrative

Disagree with this assessment? Create your own narrative in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Seadrill research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Seadrill research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Seadrill's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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