Out Fox The $treet

In a surprise move, offshore driller Seadrill Limited ( NYSE: SDRL     ) raised its dividend in the face of a difficult market for new contracts. The company even faced some operating issues during the first quarter, yet that didn't prevent solid earnings and cash flows from supporting the dividend. At the time, investors couldn't grasp the 11% dividend considering the large debt load and 19 newbuilds under construction in a tough offshore drilling market. The stock has now rallied, and investors need to understand that the bifurcation of the market provides long-term stability for a company with limited rigs older than 10 years. Companies with older rigs like Transocean ( NYSE: RIG     ) face a tougher road with limited contract coverage for 2015, so why is the market still allowing Seadrill to pay a high 10% dividend yield? Read the full article here . Disclosure: Long SDRL. Please read the disclaimer page for more details.

Seadrill Limited ( NYSE: SDRL     ) plunged over 6% when the company announced a quarterly dividend hike by $0.04 to $0.95, or 4.3%. Typically a dividend hike is greeted with positive stock returns, but in this case investors appear more concerned by other issues in the sector. Seadrill is a global leader in offshore drilling with a fleet of modern, high-specification rigs. The company is a serial deal maker with a 77.5% ownership of Seadrill Partners ( NYSE: SDLP     ) and a recent deal to acquire the majority of Sevan Drilling. The addition of Sevan during the quarter added operating costs that reduced the bottom line. Read the full article here . Disclosure: Long ATW. Please review the disclaimer page for more details. 

Whether directly or indirectly, the aggressive newbuild program at Seadrill ( SDRL ) could benefit the most from the potential opening up of Mexico to international oil service firms. While still too early to get overly excited, Merrill Lynch suggests the potential is for Mexico to add 50 onshore rigs and 20 floaters in the next two years to pull the struggling industry out of decline. Seadrill is a leading offshore deepwater drilling expert with a fleet of drillships, jack-up rigs and semi-submersible rigs operating in Northern Europe, U.S. Gulf of Mexico, Mexico, South America, West Africa, Middle East and Southeast Asia. The company owns positions in numerous other drilling oil services firms including 75.7% of Seadrill Partners ( SDLP ) that alone is worth nearly $1 billion. Read the full article on Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Anybody following the offshore drilling market knows that CEO Fredrik Halvorsen of Seadrill Limited ( SDRL ) is an aggressive operator. Not only does the company pay substantial dividends unlike the competition, but it also continuously wheels and deals rigs, divisions, and subsidiaries. The company is a leading offshore deepwater drilling expert with a fleet of drillships, jack-up rigs, and semi-submersible rigs operating in Northern Europe, U.S. Gulf of Mexico, Mexico, South America, West Africa, Middle East, and Southeast Asia. The company owns positions in numerous other drilling oil services firms including 75.7% of Seadrill Partners ( SDLP ) that alone is worth nearly $1 billion. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details.