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Transocean Ltd. (RIG) vs Seadrill Limited (SDRL)

Transocean Ltd. and Seadrill Limited are both Oil & Gas Drilling companies. Transocean Ltd. is the larger, with a market value of $5.7B against $2.6B — 2.2× the size. Seadrill Limited has negative trailing earnings, so its P/E is not meaningful; Transocean Ltd. trades at 20.3×. Seadrill Limited grew revenue faster over the last twelve months: 17.1% against 3.95%. Transocean Ltd. has the higher net margin (7.25% vs −1.13%) and the higher return on invested capital (4.05% vs 2.81%). Across the 20 metrics below, Transocean Ltd. leads on 13 and Seadrill Limited on 7.

Valuation

Metric RIG SDRL Oil & Gas Drilling median
P/E 20.30 n/m —
P/S 1.43 1.60 1.19
P/B 0.68 0.91 1.24
Price to free cash flow 7.31 70.96 14.65
EV/EBITDA 6.90 6.56 6.73
EV/Sales 2.48 1.75 2.12
Earnings yield 4.93% (0.70%) (0.70%)
Free cash flow yield 13.67% 1.41% 3.79%

Profitability

Metric RIG SDRL Oil & Gas Drilling median
Gross margin 100.00% 0.00% 33.60%
Operating margin 20.41% 8.58% 8.58%
Net margin 7.25% (1.13%) (0.52%)
Free cash flow margin 19.54% 7.20% 6.98%
Return on equity 3.53% (0.63%) (0.79%)
Return on assets 1.87% (0.44%) (0.45%)
Return on invested capital 4.05% 2.81% 2.81%

Growth

Metric RIG SDRL Oil & Gas Drilling median
Revenue growth (TTM) 3.95% 17.08% 3.33%
EPS growth (last fiscal year) (301.16%) (119.47%) (46.88%)
Revenue growth, 5-year CAGR 4.70% 6.29% 13.40%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric RIG SDRL Oil & Gas Drilling median
Debt to equity 0.59 0.26 0.59
Current ratio 1.53 2.18 1.76
Net debt to EBITDA (2.86) 0.87 0.90

Dividend

Metric RIG SDRL Oil & Gas Drilling median
Dividend yield — — —
Payout ratio — — —

Size

Metric RIG SDRL Oil & Gas Drilling median
Market cap 5.70b 2.56b 3.61b

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