Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Transocean LTD (RIG), Seadrill Ltd (SDRL): Strong Growth Lies Ahead

Page 1 of 2

Global energy demand is on the way up, led primarily by emerging markets. Therefore, opportunities abound in the energy sector. In particular, investors would be wise to consider offshore drillers, who are seeing strong upticks in business activity.

Of the publicly traded stocks that provide rigs, as well as other products and services to the offshore drilling industry, there are four that are firing on all cylinders right now and are poised to deliver strong returns going forward. Moreover, they’re handsomely rewarding their investors with compelling dividends, and should be given strong consideration by investors interested in the energy sector.

Transocean LTD (NYSE:RIG)

Strong growth lies ahead
Transocean LTD (NYSE:RIG) holds the largest worldwide rig fleet, with 80 rigs in operation. In addition, Transocean LTD (NYSE:RIG) has an impressive $27.3 billion in backlog, meaning business conditions should remain strong in the future.

Of course, the major risk surrounding Transocean LTD (NYSE:RIG) that its investors need to pay attention to is the ongoing legal trouble pertaining to the 2010 Gulf of Mexico oil spill. Some progress on this front has already been made, as Transocean LTD (NYSE:RIG) pleaded guilty to violating the Clean Water Act and was forced to pay $400 million earlier this year. In total, the company reached a settlement with the Department of Justice in the amount of $1.4 billion, paid over five years.

That being said, Transocean LTD (NYSE:RIG) has more than enough financial flexibility to withstand the financial damages stemming from the spill. Revenue is up 3.5%, and the company booked more than $1 billion in operating profit over the first six months alone.

Seadrill Ltd (NYSE:SDRL) lags behind Transocean LTD (NYSE:RIG) in terms of rigs currently in operation, but it has 25 rigs currently under construction, so investors shouldn’t worry that the company is at risk of missing out on the surge in offshore drilling activity.

Furthermore, investors should be enthusiastic because of the company’s high efficiency. Seadrill Ltd (NYSE:SDRL) has shed assets that it considers to be non-critical, including selling its tender rig division for $2.9 billion, on which it realized a gain of $1.25 billion.

At the same time, Seadrill Ltd (NYSE:SDRL) generated its best operating results and net income ever in its recently concluded second quarter. In all, net income totaled $1.75 billion. The fact that Seadrill Ltd (NYSE:SDRL) is booking record results while simultaneously streamlining its operations is a huge credit to management, and investors should be excited as a result.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!