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Seadrill (SDRL): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q3 2026, to Sep 30, 2026, filed Nov 4, 2026; rules v1.1
Seadrill (SDRL): 1 rule of 10 triggered on the filings to Sep 30, 2026: receivables growing = future cash is certain. 1 to review; 3 with insufficient data; 4 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Receivables growing = future cash is certain Triggered · severity medium · confidence medium
Receivables grew 34% year over year in Q3 2026 against revenue growth of 18%, and the quarter before 62% against 19%; days sales outstanding is 59 against a median of 47 over the eight quarters before. More of each quarter's revenue is still owed by customers.
Innocent reading: Seasonality: a quarter that always ends with big shipments.
A precise DCF value = the true value To review · confidence high
The DCF's point value is 45.78 a share (price 42.20); 37% of it is the terminal value, a number about years no one has seen. Moving operating margin by ±3 pts alone takes it from 36.66 to 54.91; across every method the research ran the range is -39 to 131. The value is a range; the decimals are not information.
Innocent reading: A stable, mature business with a narrow range of outcomes, where the point value is a fair summary.
Every rule
A01 FCF growth = the business improved Insufficient data
fewer than two fiscal years with operating cash flow and capital expenditure on file
A07 Stock compensation added back = no economic cost Not triggered confidence high
Stock compensation is 1.4% of revenue: small enough that adding it back changes little.
The figures and how they are read
| Fiscal year | FY2025 |
| Stock compensation | $20M |
| Revenue | $1.4B |
| SBC / revenue | +1.4% |
| Buybacks | 0 |
| Buybacks / SBC | 0.0 |
| Diluted shares, year before | 71.0M shares |
| Diluted shares | 65.0M shares |
| Diluted shares: change | -8.5% |
SBC / revenue from the cash flow statement's add-back; the diluted weighted share count year over year; buybacks from the financing section
Source: FY2025 (stock compensation, buybacks and the diluted share count, fiscal year)
B02 Receivables growing = future cash is certain Triggered severity medium · confidence medium
Receivables grew 34% year over year in Q3 2026 against revenue growth of 18%, and the quarter before 62% against 19%; days sales outstanding is 59 against a median of 47 over the eight quarters before. More of each quarter's revenue is still owed by customers.
The figures and how they are read
| Quarter | Q3 2026 |
| Revenue, year over year | +17.9% |
| Receivables, year over year | +33.5% |
| Quarter before | Q2 2026 |
| Revenue y/y, quarter before | +19.1% |
| Receivables y/y, quarter before | +62.0% |
| Days sales outstanding | 59.1 |
| DSO, median of eight quarters | 47.0 |
| Receivables | $239M |
| Revenue | $428M |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q3 2026 (receivables and revenue) · Q3 2025 (the same quarter a year earlier)
What would explain it innocently
- Seasonality: a quarter that always ends with big shipments
- An acquisition brought its own receivables
- New business with longer standard terms (government, large enterprise)
- Currency: receivables booked in a strengthening currency
What to look for in the filing
- The receivables ageing and the allowance for credit losses
- Any factoring or receivables sold (and whether with recourse)
- Credit terms by customer group
What would show the trap does not apply
- Receivables fall back in line with revenue in the next quarter and DSO returns to its history
- The 10-Q attributes the increase to a disclosed one-off (a large customer's timing, an acquisition) and the allowance for doubtful accounts did not rise
Look again: next filing.
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Insufficient data
neither a maturity table nor the current portion of debt is on file
D03 EPS growth = profit growth Not applicable
a loss in one of the quarters: EPS growth has no meaning
E02 Low P/E at a cyclical peak = undervalued Not applicable
a loss on a trailing or mid-cycle basis: the P/E has no meaning
E07 A precise DCF value = the true value To review confidence high
The DCF's point value is 45.78 a share (price 42.20); 37% of it is the terminal value, a number about years no one has seen. Moving operating margin by ±3 pts alone takes it from 36.66 to 54.91; across every method the research ran the range is -39 to 131. The value is a range; the decimals are not information.
The figures and how they are read
| dcf value | 45.78 |
| price | 42.20 |
| terminal value share | +37.0% |
| swing by input | Operating margin / ±3 pts / 36.66 / 54.91; Revenue growth (each year) / ±5 pts / 38.55 / 54.16; WACC / ±1 pt / 41.72 / 51.14; Tax rate / ±5 pts / 43.77 / 47.79 |
| range all methods | -38.5; 130.6 |
the DCF's point value against the share of it that is the terminal value and the value at each input moved by one step (growth ±5 pts, WACC ±1 pt, margin ±3 pts …); the range across every method the research ran
Source: 2026-11-08 (valuation research)
What would explain it innocently
- A stable, mature business with a narrow range of outcomes, where the point value is a fair summary
- The inputs that matter most are themselves well known (a regulated return, a long contract)
What to look for in the filing
- Which input you believe differs from the research's and why
- What the price implies for growth (the reverse DCF on the fair-value page)
What would show the trap does not apply
- The DCF's value is robust to the terminal growth and discount rate (the range's low end is still above the price)
- The company's cash flows over the next three years track the DCF's early years
Look again: next filing.
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Seadrill: cash flow →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.