Seadrill vs Transocean Which Is a Smarter Choice?

Seadrill Ltd. and Transocean Ltd. are two major players in the offshore drilling industry, offering services to the oil and gas sector worldwide. Both companies have faced challenges in recent years due to fluctuations in oil prices and oversupply in the market. Investors have been closely monitoring their stocks as they navigate through these turbulent times. Seadrill has undergone significant restructuring to reduce debt, while Transocean has focused on improving operational efficiency. Analysts have varying opinions on the future performance of these stocks, making them intriguing options for investors seeking exposure to the oil and gas industry.

Seadrill or Transocean?

When comparing Seadrill and Transocean, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Seadrill and Transocean.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Seadrill has a dividend yield of -%, while Transocean has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Seadrill reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Transocean reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Seadrill P/E ratio at 6.02 and Transocean's P/E ratio at -5.56. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Seadrill P/B ratio is 0.86 while Transocean's P/B ratio is 0.34.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Seadrill has seen a 5-year revenue growth of 4.28%, while Transocean's is -0.43%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Seadrill's ROE at 14.07% and Transocean's ROE at -5.95%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $38.50 for Seadrill and $3.91 for Transocean. Over the past year, Seadrill's prices ranged from $34.74 to $56.46, with a yearly change of 62.52%. Transocean's prices fluctuated between $3.85 and $6.88, with a yearly change of 78.70%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.