12 Best Long-Term Penny Stocks to Buy According to Hedge Funds

9. Borr Drilling Limited (NYSE:BORR)

Stock Price: $3.90

5-Year Sales Growth: 26.86%

Number of Hedge Fund Holders: 10

Borr Drilling Limited (NYSE:BORR) is an offshore drilling company that particularly focuses on shallow waters, which means they operate in areas where the water depth is up to about 400 feet. It owns and operates jack-up rigs, which are floating platforms that can be raised above the water level for drilling operations. The company currently owns 22 rigs and is in the process of acquiring two more.

During the fiscal third quarter of 2024, Borr Drilling Limited (NYSE:BORR) reported significant developments. It secured contract extensions for several rigs, including Mist, Prospector 1, and Hild. The company noted healthy utilization levels for modern rigs and maintained rates above 94%, despite some regional softness in Asia and the Middle East due to aggressive competition for contracts. However, despite a healthy utilization rate, its revenue decreased by $30.3 million compared to Q2 2024. Management noted that the decline was due to one-off events in the last quarter, including $17.5 million from the termination of the Rig Arabia contract and $10.6 million related to changes in the operating structure of its Mexican joint ventures.

Borr Drilling Limited (NYSE:BORR) anticipates that demand for jack-up rigs will remain strong, supported by stable Brent crude prices above $70 per barrel, making shallow-water projects economically viable. Management also noted that the company will enter 2025 with nearly 80% of its fleet contracted at an average day rate of $148,000 per day, providing strong revenue visibility.