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Valaris Limited
🏹 Trader: | BRS 66 Forming View all →
$6.2B
Market Cap
3.6
P/E
0.04
PEG
25.6%
ROCE
36.2%
ROE
0.34
D/E
20.1%
OPM
-24.3%
% from 52W High
82
α RS
🔍 VAL is showing a high-conviction setup because it matches 16 of 37 tracked screener presets, Sector RRG has Energy in the Leading quadrant with the trail still rolling over, and RS Rating is 82. Net: Broad signal stack, not a recommendation. ? Conviction RRG RS Rating
Sources
Conviction 16/37 · Energy in Leading quadrant · RS Rating 82
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Currency-adjusted total returns for VAL including FX impact
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📈 Price History
Ratio Health
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About

Valaris Limited, together with its subsidiaries, provides offshore contract drilling services in Brazil, the United Kingdom, Gulf of America, Australia, Angola, and internationally.

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📈 Growth Pattern
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🎙 Management Tone Confident Specific → Stable 4 quarters Full tone analysis in Intelligence →
📊 MIXED Offshore driller with $4.5B backlog, 12 seventh-gen drillships, $596M Q3 revenue.
Revenue & Profitability
Third quarter 2025 total revenues were $596 million (down from $615 million in Q2 2025) and adjusted EBITDA was $163 million (down from $201 million in Q2, which included a $24 million favorable arbitration benefit). Adjusted free cash flow for the quarter was $237 million, including $100 million of net proceeds from the sale of Valaris 247. The company ended Q3 with $676 million of cash and cash equivalents.
Outlook
Management expects global drillship utilization to trough late 2025 or early 2026 before improving in the second half of 2026, with seventh-generation drillships exiting 2026 at around 90% utilization. The long-term outlook is constructive due to historic underinvestment and slowing non-OPEC production growth, with approximately 70% of deepwater spending over the next three years having breakeven prices below $50/bbl. Near-term commodity price uncertainty exists, but customers continue to push forward with long-cycle offshore projects.
Growth Drivers
Key growth drivers include substantial floater demand in Africa (roughly half of long-term opportunities), stable demand in Brazil, and healthy jack-up demand led by Saudi Aramco rig reactivations and North Sea opportunities. Valaris has added $2.2 billion in backlog year-to-date and is in advanced discussions for drillships completing contracts in the second half of 2026. The company is also tracking multiple tenders for development programs in West Africa, the Mediterranean, and Asia.
Balance Sheet & CapEx
Third quarter capital expenditure was $70 million, below guidance due to timing shifts to Q4. Fourth quarter 2025 CapEx guidance is $145 million–$165 million. Full-year 2025 CapEx is expected to be approximately $390 million. The company also expects to receive approximately $70 million in customer upfront payments for contract-specific upgrades during the year.
Margins
Not discussed in detail as a separate metric, but implied adjusted EBITDA margin was roughly 27% in Q3 2025. Fourth quarter adjusted EBITDA guidance is $70 million–$90 million on revenues of $495 million–$515 million, implying significantly lower margins due to fewer operating days and idle rigs. Contract drilling expense is expected to decrease to $390 million–$405 million in Q4 as costs are reduced on rigs without follow-on work. G&A expense is stable at ~$27 million per quarter.
Key Risks
Near-term commodity price uncertainty may affect customer decisions. Two drillships (Valaris DS-15 and DS-18) are currently idle after completing contracts, and two semis (DPS-1 and MS-1) will complete contracts by year-end without immediate follow-on work, creating a period of white space. Day rates for new floater contracts have troughed in the high $300k to low $400k range. Discussions with Petrobras regarding cost reductions are at an early stage and could impact future revenue. There is no guarantee of securing gap-fill contracts for idle rigs.
Generated by AI · Q3 2025 results · Not investment advice
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✓ 📞 Earnings Call Transcripts (5 quarters) submit a missing quarter
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📞 Earnings Call Transcripts (5)
Q3 2025 Q3 2025 2025-10-30
Strong Q3 operational and financial performance included $163M adjusted EBITDA and $237M free cash flow, with all near-term available drillships now contracted. Backlog grew to $4.5B, and robust offshore demand is expected to drive high utilization and day rates by 2026.
Q2 2025 Q2 2025 2025-07-31
Q2 2025 saw strong operational and financial results, with 96% revenue efficiency and $201M adjusted EBITDA. Backlog reached $4.7B, driven by new floater and jackup contracts, and full-year EBITDA guidance was raised. Offshore market fundamentals remain robust.
Q1 2025 Q1 2025 2025-05-01
Strong Q1 results with $621M revenue and $181M adjusted EBITDA, driven by high operational efficiency and over $1B in new contract backlog. Full-year guidance reaffirmed, with nearly 99% of revenue contracted and robust liquidity maintained.
Q4 2024 Q4 2024 2025-02-20
Q4 2024 saw strong operational and safety performance, with revenue efficiency at 96% and $584M in revenue. The outlook for 2025 is solid, with 94% of revenue already contracted and a focus on high-spec assets, despite near-term floater idle time.
Q3 2024 Q3 2024 2024-10-31
Q3 2024 saw strong operational and financial results, with $643M revenue, $150M Adjusted EBITDA, and $111M free cash flow. Despite deferred demand, the outlook for 2026+ remains robust, and share repurchases continue. Day rates and utilization are expected to remain solid.
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📊 Analysis Methodology

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Financial Model
Projections are built from each company's audited annual financials (Income Statement, Balance Sheet, Cash Flow) over the last 5 fiscal years. Forward assumptions — revenue growth %, EBITDA margin, D&A (USD millions), interest expense, tax rate, and capex — are AI-generated using historical context and refreshed twice a year: after the December results season and after the September/Q4 results season.

DCF Valuation
Fair Value = Σ(FCFt / (1+WACC)t) + Terminal Value. Terminal Value uses the Gordon Growth Model: FCF5 × (1+g) / (WACC−g). Default WACC: 10% (US risk-free ~4.5%, equity risk premium ~5.5%). Default terminal growth: 3% (long-run US nominal GDP proxy).

CAGR Tracker
Expected 5-year CAGR = (DCF Fair Value / Current Price)1/5 − 1. Assumes fair value is reached in exactly 5 years — a mechanical estimate only.

Data Sources & Limitations
Financial statements sourced from public filings. Prices updated daily. Forward assumptions are AI-generated. All monetary values in USD millions. Non-US ADR companies may have currency conversion inaccuracies. Models are point-in-time and do not update intra-quarter or account for M&A, macro shocks, or extraordinary items.

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