UBS' drilling company analyst Angie Sedita is out with a big call for her coverage area: drillers are entering a realm of free cash flow never seen before, which is great news for investors.

"We believe we are entering into a New Era for the diversified oil service companies and we do not use that term lightly," she writes.

Drillers have reached the point where cash flows are sufficiently covering capital expenditures, and the companies are seeing big returns.

So, that means:

Higher and more frequent dividends

Slightly decreased earnings (which usually happens when dividends ramp up)

More share buybacks (to compensate for that nominally lower EPS)

Specifically, Schlumberger, Halliburton, Baker Hughes and Weatherford will start generating free cash flow yields (FCF per share per share price) of up to 6 percent, she says. For most of their history, none of these frims were able to produce strong, consistent receipts.

Sedita lays out several different capex scenarios and their effect on free cash flow yield here:

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