Seadrill (NYSE: SDRL) will release its quarterly report on Wednesday, and in somewhat of a departure from the general trend the stock has taken, analysts expect Seadrill earnings to fall from year-ago levels. Yet with the stock very close to all-time highs, most investors clearly believe that any weakness in Seadrill will be temporary and that the world's thirst for oil and gas will continue to drive profit growth higher in the future.

Even as shale plays like the Bakken have gained notoriety in the energy business, one of the new frontiers for oil and gas production has come from increased attention on ultra-deepwater plays. Seadrill was fortunate to get in on the trend toward offshore drilling early, and its fleet of drillships have reaped huge day rates from strong demand among production companies. Yet will the good times last well into the future, even as newly built ships start to come online throughout the industry? Let's take an early look at what's been happening with Seadrill over the past quarter and what we're likely to see in its report.

Stats on Seadrill

Analyst EPS Estimate

$0.61

Change From Year-Ago EPS

(16.4%)

Revenue Estimate

$1.15 billion

Change From Year-Ago Revenue

2.3%

Earnings Beats in Past 4 Quarters

1

Source: Yahoo! Finance.

How low will Seadrill earnings go?
In recent months, analysts have had somewhat mixed views on Seadrill earnings. They've added a penny per share to their June-quarter estimates and $0.08 to their full-year 2013 projections, but they've reduced their 2014 consensus by that same $0.08 per share figure. The stock hasn't felt any hesitation, though, rising more than 12% since late May.

Much of the good news for Seadrill came when the company reported its first-quarter earnings results back in May. A 20% jump in revenue came in part due to higher utilization figures for its fleet of floating vessels, although rising fixed jack-up demand finally started making a positive contribution to the company's bottom line. By contrast, some of Seadrill's competitors struggled early in the year, as the necessity to replace bolts on blowout preventers was a factor in relatively low utilization rates for Transocean (NYSE: RIG) and Noble (NYSE: NE), both of which were in the low- to mid-80s during the first quarter compared to Seadrill's 92%.

But Seadrill's future depends on its building out its fleet, and that's exactly what the company has done. By forming its Seadrill Partners (NYSE: SDLP) master limited partnership, Seadrill has given investors a dividend-favored way to invest in the company's drillships, but it has also facilitated fleet management. In addition, Seadrill expects to keep adding fleet assets, with both ultra-deepwater rigs and jack-up assets among expected acquisitions in the coming years. With Transocean, Noble, and other competitors also building up their fleets, there's a definite advantage to being first to the table, especially as long-term concerns may arise about the ability for the market to sustain $600,000 day-rates after newly built ultra-deepwater rigs come on line.

Seadrill has benefited from strong partnerships with international companies, helping it take advantage of the increasingly global demand for oil services. Petrobras awarded a major contract to Seadrill's joint venture with Malaysia's SapuraKencana in June, bolstering their already strong relationship. For its part, Seadrill should continue to reap rewards from its global scope.

In the Seadrill earnings report, be sure to watch for comments about whether management expects day-rates to fall as new capacity becomes available. For now, though, prospects look good for Seadrill's immediate future, and barring an unforeseen plunge in oil prices, earnings growth is likely to resume its upward trend.

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Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Seadrill. The Motley Fool owns shares of Seadrill and Transocean. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.