Key Takeaways Transocean will report Q3 earnings on Oct. 29, with estimates at $0.04 per share on $1.01B revenues.The Ultra-Deepwater Floaters segment is projected to grow nearly 10% year over year to $733.9M.Average utilization is estimated at 75%, up 11.1% from last year, though costs likely rose 1.5%.Transocean Ltd. (RIG) is set to release third-quarter results on Oct. 29. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 4 cents per share on revenues of $1.01 billion.Let ...

Group 1 - The Iranian Offshore Oil Company (IOOC) has signed two agreements to acquire advanced offshore drilling rigs to enhance production from oil and gas fields, with approval from the National Iranian Oil Company (NIOC) [1][2] - The new drilling rigs, measuring 350ft and 400ft, will be deployed in Iran's offshore joint oil and gas fields in the Persian Gulf, following a comprehensive deployment strategy [2] - The acquisition of these rigs is expected to accelerate the development of joint oil and gas fields and significantly increase national oil and gas output [2][3] Group 2 - Iran has achieved a new seven-year high in oil and gas production, with average crude oil production exceeding four million barrels per day in 2024, marking a recovery in field capacity [4] - The increase in daily oil production by 247,000 barrels compared to the previous year indicates improved production management by key national companies [4] - The National Iranian South Oil Company contributed nearly 75% of the total output, producing over 914 million barrels of crude oil throughout the year [5] - In the gas sector, Iran's total production reached 1.11 trillion cubic meters, equivalent to the yearly consumption of several medium-sized nations, with the Pars Oil and Gas Company producing 245.9 billion cubic meters [5]

Industry Overview - The Zacks Oil and Gas - Drilling industry includes companies that provide rigs and services for oil and gas exploration and development on a contractual basis [2] - Drilling for hydrocarbons is costly and technically challenging, with future prospects primarily dependent on contracting activity and rig availability rather than oil or gas prices [2] - Offshore drilling companies experience higher volatility compared to onshore counterparts, with their share prices more closely correlated to oil prices [2] Current Market Conditions - The industry is currently facing uncertainty and volatility due to cautious customer spending, geopolitical risks, and fluctuating oil prices [1][3] - Contracting activity has slowed, with operators deferring work to maintain capital discipline, impacting near-term earnings visibility [3] - Day rates have decreased from previous highs, and rig utilization is expected to bottom in the mid-80% range before recovery [5] Long-Term Outlook - A structural rise in LNG demand is anticipated to drive drilling activity, particularly from 2026 onward, providing a more stable outlook for drillers [1][4] - The global expansion of LNG is expected to support rig utilization and long-cycle contracts tied to offshore basins [1][4] Industry Performance - The Zacks Oil and Gas - Drilling industry ranks 210 out of 244 Zacks industries, placing it in the bottom 14% [6][7] - The industry's earnings estimates for 2025 have decreased by 94.6% over the past year, and estimates for 2026 have fallen by 66% [9][8] - Over the past year, the industry has declined by 20%, underperforming the broader Zacks Oil - Energy sector, which increased by 5.7%, and the S&P 500, which gained 20.2% [10] Valuation Metrics - The industry is currently trading at an EV/EBITDA ratio of 5.50X, significantly lower than the S&P 500's 17.94X but above the sector's 5X [13][12] - Historical trading ranges for the industry show a high of 24.81X and a low of 4.97X over the past five years, with a median of 14.54X [13] Notable Companies - **Transocean**: A leading offshore drilling contractor with a focus on ultra-deepwater and harsh environment drilling, reported contract drilling revenues of $988 million for Q2 2025, a nearly 15% increase year-over-year [15][16] - **Helmerich & Payne**: The largest land drilling contractor in the U.S., known for its FlexRig fleet and advanced automation, has a market capitalization of $2 billion and has lost 33% in a year [18][20] - **Precision Drilling**: A top drilling rig contractor in Canada with operations in the U.S. and the Middle East, has a market capitalization of $743.3 million and has seen its earnings estimates for 2025 rise from $3.89 to $4.70 per share in the past 60 days [22][24]

Core Viewpoint - SFL Corporation Ltd. announced preliminary financial results for Q2 2025, reporting a net income of $1.5 million and a quarterly cash dividend of $0.20 per share, reflecting ongoing efforts to strengthen its charter backlog and improve operational efficiency [1][4][5]. Financial Performance - The company reported a net income of $1.5 million, equating to $0.01 per share for the second quarter [7]. - Charter hire received in the quarter totaled $194 million, with approximately 87% from shipping and 13% from energy [7]. - Adjusted EBITDA from consolidated subsidiaries was $104 million, with $97 million from shipping and $7 million from energy, plus an additional $8 million from associated vessel owning companies [7]. Strategic Actions - SFL has taken decisive steps to enhance its charter backlog by securing agreements with strong counterparties and investing in cargo-handling and fuel-efficiency upgrades [3]. - The company has divested older, less efficient vessels, which has improved the operational and fuel consumption efficiency of its fleet [3]. - A five-year time charter extension for three 9,500 TEU container vessels with Maersk is expected to add approximately $225 million to the backlog from 2026 through 2031 [7]. Dividend Information - The Board of Directors declared a quarterly cash dividend of $0.20 per share, to be paid on or around September 29, 2025, with a record date of September 12, 2025 [5][6]. - Since its inception in 2004, SFL has distributed a total of $2.9 billion to shareholders through 86 consecutive quarterly cash dividends [5]. Market Conditions - The market for the legacy drilling rig Hercules remains challenging due to recent market uncertainty and oil price volatility, which has delayed new employment opportunities [4]. - The company is optimistic about finding new employment for the rig while exploring strategic opportunities [4].

Financial Highlights - Noble Corporation's market capitalization is $6.2 billion[6] - The company's 2023 Free Cash Flow (FCF) was $184 million[6] - The company's 2023 Adjusted EBITDA was $810 million[6] - The company's backlog stands at $4.6 billion[6] - The company's quarterly dividend is $0.40[6] - The company's 2023 Adjusted EBITDA margin was 31%[6] Market Overview - Average deepwater greenfield investment is expected to increase by 60% in 2025-27 compared to 2021-24[9] - Tier-1 Ultra-Deepwater (UDW) marketed utilization is at 100%[14] - Total UDW marketed utilization is at 97%[14] - Total floater marketed utilization is at 95%[14]

Core Insights - SFL Corporation Ltd. reported preliminary financial results for Q1 2025, including a net loss of $31.9 million or $0.24 per share, primarily due to impairments on older dry-bulk vessels and the idleness of the drilling rig Hercules [1][6] - The company declared a quarterly cash dividend of $0.27 per share, marking the 85th consecutive quarterly dividend [5][6] - Charter hire revenue for the quarter was $193.5 million, which included $1.5 million from profit share, while adjusted EBITDA was $108.0 million from consolidated subsidiaries and $7.7 million from associated companies [6] Financial Performance - The net loss of $31.9 million was attributed to one-off items, including impairments on older vessels [3][6] - Charter hire revenue was reported at $193.5 million, with an adjusted EBITDA of $115.7 million when including associated companies [6] - The company has been actively repurchasing shares, with a $10 million buyback at an average price of $7.98 per share [6] Fleet Management - SFL continues to renew its fleet by divesting older bulkers and containerships, focusing on assets with a charter backlog to support long-term dividend distribution [4][6] - The company upgraded several vessels during the quarter, enhancing cargo intake and fuel efficiency [3][4] Dividend Information - The declared quarterly cash dividend of $0.27 per share will be paid on or around June 27, 2025, with the record date set for June 12, 2025 [5][6] - This dividend reflects the company's commitment to maintaining a consistent distribution to shareholders [8]

Company Overview - SFL Corporation Ltd. has a unique track record in the maritime industry, having paid dividends every quarter since its initial listing on the New York Stock Exchange in 2004 [3] - The company's fleet includes tanker vessels, bulkers, container vessels, car carriers, and offshore drilling rigs, supported by a portfolio of long-term charters and significant growth in the asset base over time [3] Financial Results Announcement - SFL plans to release its preliminary financial results for the first quarter of 2025 on May 14, 2025 [1] - A conference call and webcast for stakeholders will be held on the same day at 10:00 AM (EST) / 4:00 PM (CET) [1] Investor Relations - Relevant materials for the financial results will be available on the Investor Relations section of the company's website on the same day as the announcement [1] - Investors can join the conference call in listen-only mode via the company's website or participate in a live Q&A through Zoom [2]

Core Viewpoint - Transocean Ltd. is expected to report a first-quarter 2025 earnings loss of 12 cents per share, with revenues estimated at $885.84 million, reflecting a significant year-over-year decrease in earnings but an increase in revenues [1][3]. Group 1: Previous Quarter Performance - In the last reported quarter, Transocean posted an adjusted net loss of 9 cents per share, missing the consensus estimate of a profit of 1 cent, and adjusted revenues of $952 million, which also fell short of the $959 million estimate [2]. - The company has had mixed results in the past four quarters, beating estimates twice and missing twice, resulting in an average negative surprise of 227.65% [3]. Group 2: Revenue and Cost Projections - The Zacks Consensus Estimate for the first quarter indicates a 300% year-over-year decrease in earnings, while revenues are projected to increase by 15.49% from $767 million in the previous year [3]. - Revenue growth is anticipated in the Ultra-Deepwater Floaters segment, expected to rise by 16.3% to $661.9 million, and the Harsh Environment Floaters segment is projected to surge by 36.7% to $223.5 million [5]. - Total costs and expenses are expected to increase by 19.2% year-over-year to $906 million, with Operating and Maintenance costs rising by 17.8% to $616.2 million and depreciation and amortization expenses increasing by 28.5% to $237.7 million [6][7]. Group 3: Earnings Prediction Model - The current model does not predict an earnings beat for Transocean, as the Earnings ESP is -12.50%, indicating a lower likelihood of exceeding earnings expectations [9]. - Transocean holds a Zacks Rank of 3, suggesting a neutral outlook [10].