• 繁

    • -+ 0.00%
    -+ 0.00%
    -+ 0.00%

    Why Valaris (VAL) Is Down 8.5% After Landing a US$300 Million Shell Drillship Deal

    Simply Wall St·12/20/2025 06:18:13
    語音播報
    • Valaris Limited recently announced it has secured a multi-year contract with Shell for the drillship VALARIS DS-8 offshore Brazil, starting in the first quarter of 2027, with an estimated 800-day duration and total value of approximately US$300,000,000.
    • This long-term, high-value contract enhances Valaris's future revenue visibility and reinforces demand for its high-specification deepwater drilling capabilities in Brazil.
    • We’ll now examine how this multi-year, US$300,000,000 Shell contract could reshape Valaris’s investment narrative and future earnings profile.

    Trump has pledged to "unleash" American oil and gas and these 22 US stocks have developments that are poised to benefit.

    Valaris Investment Narrative Recap

    To own Valaris, you need to believe that offshore drilling will remain an essential part of global energy supply and that high spec drillships can stay well utilized. The new multi year, US$300,000,000 Shell contract slightly strengthens near term visibility, but the biggest swing factor still looks to be how industry utilization and day rates evolve into 2026, while overcapacity and potential idle time remain key risks.

    Among recent updates, the July 2025 Anadarko (Oxy) contracts for VALARIS DS-16 and DS-18 stand out, adding about US$760,000,000 of backlog from mid 2026. Together with the Shell award, they underline how securing long duration floater work is central to Valaris’s main catalyst of converting a robust project pipeline into firmer earnings, even as industry overcapacity and timing of awards could still pressure day rates.

    But investors should also be aware that if floater and jackup utilization troughs in 2026, it could...

    Read the full narrative on Valaris (it's free!)

    Valaris' narrative projects $2.4 billion revenue and $453.7 million earnings by 2028. This requires a 1.2% yearly revenue decline and an earnings increase of about $178 million from $275.5 million today.

    Uncover how Valaris' forecasts yield a $55.10 fair value, a 11% upside to its current price.

    Exploring Other Perspectives

    VAL 1-Year Stock Price Chart
    VAL 1-Year Stock Price Chart

    Nine members of the Simply Wall St Community currently see fair value anywhere between about US$31.60 and US$257.55 per share, highlighting very different expectations. Against that backdrop, the risk that offshore capacity loosens and day rates soften could meaningfully affect how quickly Valaris converts its growing backlog into stable earnings, so it is worth comparing several of these viewpoints before deciding where you stand.

    Explore 9 other fair value estimates on Valaris - why the stock might be worth 36% less than the current price!

    Build Your Own Valaris Narrative

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

    Interested In Other Possibilities?

    Markets shift fast. These stocks won't stay hidden for long. Get the list while it matters:

    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.