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Nabors Industries (NBR)
NYSE:NBR
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Nabors Industries
(NYSE:NBR)42Neutral
Positive Factors
International Operations
Company has line of sight on projects for up to 50 rigs in Asia, Latin America, North Africa and the Mid East.
IPO and Equity Value
Management believes an IPO of its SANAD business could unlock more than $2bn in equity value with half accruing to NBR.
Negative Factors
Financial Performance
4Q EBITDA misses by 2%, guides 1Q25 lower by 6%.
Nabors Industries (NBR) vs. S&P 500 (SPY)
Market Cap
$396.82M
Dividend YieldN/A
Average Volume (3M)387.32K
Price to Earnings (P/E)―
Beta (1Y)1.21
Revenue Growth-2.52%
EPS Growth-450.75%
CountryUS
Employees12,400
SectorEnergy
Sector Strength57
IndustryFossil Fuels
Share Statistics
EPS (TTM)-22.36
Shares Outstanding9,603,654
10 Day Avg. Volume456,961
30 Day Avg. Volume387,316
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.14
Price to Cash Flow (P/CF)0.70
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$67.67Price Target Upside63.77% Upside
Rating ConsensusHold
Number of Analyst Covering7
Nabors Industries Business Overview & Revenue Model
Company DescriptionNabors Industries Ltd. is a leading provider of advanced drilling services for the energy industry, primarily focusing on oil and natural gas sectors. The company operates one of the world's largest land-based drilling rig fleets and also provides a significant number of offshore platform rigs in the United States and various international markets. Nabors is known for its innovative technologies, tools, and software that enhance drilling efficiency and safety.
How the Company Makes MoneyNabors Industries generates revenue through several key streams, primarily from drilling contracts with oil and gas exploration and production companies. The company earns money by leasing its extensive fleet of land and offshore drilling rigs to clients, who pay for the duration and complexity of the drilling projects. Nabors also offers related services such as directional drilling, rig equipment rentals, and drilling optimization software solutions, which contribute additional earnings. Furthermore, the company's strategic partnerships and long-term contracts with major energy companies ensure a steady flow of income, while technological advancements in drilling methods provide competitive advantages and opportunities for increased profitability.
Nabors Industries Financial Statement Overview
Summary
Nabors Industries faces challenges with profitability and high leverage. Improvements in cost management are noted, but persistent net losses and declining equity levels highlight financial instability. The company should focus on improving its capital structure and operational efficiencies.Income Statement
Nabors Industries has experienced inconsistent revenue figures with significant volatility in net income. The gross profit margin has improved in the latest period, indicating better cost management. However, the company has struggled with achieving consistent net profitability, as evidenced by negative net income figures in recent years. Revenue growth has been erratic, pointing to instability in operational performance.42
Neutral
Balance Sheet
The balance sheet shows a high level of debt relative to equity, which poses financial risk. The debt-to-equity ratio remains elevated, suggesting potential leverage issues. Stockholders' equity has been declining, impacting the equity ratio negatively. This could indicate potential solvency concerns if not managed properly.38
Negative
Cash Flow
Cash flow statements reveal moderate operational cash flow, but free cash flow has diminished over time. The operating cash flow to net income ratio is positive, indicating that the company generates cash despite net losses. However, free cash flow growth is weak, which could impact future liquidity and investment capacity.50
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.93B | 3.01B | 2.65B | 2.02B | 2.13B | Gross Profit |
| 554.31M | 570.31M | 322.69M | 37.27M | -52.73M | EBIT |
| 0.00 | 269.86M | -747.85M | -944.82M | -1.17B | EBITDA |
| 813.23M | 959.70M | 597.28M | 376.77M | 354.41M | Net Income Common Stockholders |
| -176.08M | -50.25M | -307.22M | -543.71M | -762.85M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 397.30M | 1.07B | 452.31M | 991.49M | 481.75M | Total Assets |
| 4.50B | 5.28B | 4.73B | 5.53B | 5.50B | Total Debt |
| 2.51B | 3.15B | 2.54B | 3.26B | 2.97B | Net Debt |
| 2.12B | 2.09B | 2.09B | 2.27B | 2.50B | Total Liabilities |
| 3.30B | 4.00B | 3.51B | 4.13B | 3.80B | Stockholders Equity |
| 135.00M | 326.61M | 368.96M | 590.66M | 1.15B |
| Cash Flow | Free Cash Flow | |||
| 13.51M | 97.01M | 127.64M | 191.14M | 154.24M | Operating Cash Flow |
| 581.43M | 637.86M | 501.09M | 428.78M | 349.76M | Investing Cash Flow |
| -555.46M | -570.42M | -368.71M | -117.22M | -165.46M | Financing Cash Flow |
| -662.05M | 592.59M | -661.53M | 488.42M | -148.00M |
Nabors Industries Technical Analysis
Negative
41.32
Price Trends
54.00
Negative
63.16
Negative
69.06
Negative
Market Momentum
-4.80
Negative
36.36
Neutral
53.64
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NBR, the sentiment is Negative. The current price of 41.32 is below the 20-day moving average (MA) of 44.73, below the 50-day MA of 54.00, and below the 200-day MA of 69.06, indicating a bearish trend. The MACD of -4.80 indicates Negative momentum. The RSI at 36.36 is Neutral, neither overbought nor oversold. The STOCH value of 53.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NBR.
Nabors Industries Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $56.26B | 13.32 | 21.59% | 2.68% | 9.58% | 6.53% | |
67 Neutral | $2.54B | 8.45 | 10.50% | 5.24% | -2.59% | -27.85% | |
57 Neutral | $8.34B | 5.35 | -5.98% | 7.29% | 0.20% | -69.45% | |
55 Neutral | $2.90B | ― | -23.39% | 4.26% | 29.70% | -341.43% | |
52 Neutral | $2.67B | ― | -4.95% | ― | 24.44% | 53.99% | |
42 Neutral | $396.82M | ― | -89.17% | ― | -2.52% | -450.75% |
* Energy Sector Average
Performance Comparison
NBR
Nabors Industries
41.32
-43.13
-51.07%
HP
Helmerich & Payne
25.57
-12.62
-33.05%
PTEN
Patterson-UTI
7.51
-4.06
-35.09%
SLB
Schlumberger
41.37
-8.83
-17.59%
RIG
Transocean
3.04
-2.39
-44.01%
Nabors Industries Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: -22.75% | Next Earnings Date: Apr 23, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. While Nabors Industries Ltd. highlighted growth in international markets and technological advancements, there were significant challenges in cash flow and the US market. The SANAD new build program and Parker Wellbore acquisition are positive, but cash flow issues and lower 48 market challenges present concerns.Highlights
International Market Growth
Nabors Industries Ltd. activated a total of ten international rigs in 2024 and announced nine startups for 2025, with plans for additional deployments in key geographies.
SANAD New Build Program
SANAD deployed its ninth new build during the fourth quarter, with five more scheduled for 2025. The program is expected to generate approximately $200 million in EBITDA in 2026.
Technology and Innovation Success
NDS's gross margin exceeded 54% in the fourth quarter, marking a record performance and demonstrating the benefits of the NDS portfolio.
Parker Wellbore Acquisition
Nabors Industries Ltd. announced the acquisition of Parker Wellbore, with expected annualized cost synergies of at least $35 million in 2025.
Lowlights
Free Cash Flow Shortfall
Free cash flow fell short in the fourth quarter due to delays in Mexico payments and accelerated milestone payments in Saudi Arabia.
Challenges in the Lower 48 Market
The lower 48 market did not improve as anticipated, with a reduction in rig count and lower daily margins.
Mexico Payment Delays
Significant delays in payments from a customer in Mexico of approximately $50 million affected cash flow.
Pemex Activity Reduction
Pemex announced reduced activity for 2025 due to budgetary challenges, impacting revenue expectations.
Company Guidance
During Nabors Industries Ltd.'s fourth quarter 2024 earnings call, the company provided detailed guidance for 2025. The management highlighted several key metrics, including a total adjusted EBITDA of $221 million for the fourth quarter. They anticipate the daily rig margin in the lower 48 to remain around $14,600, with an average rig count between 62 and 64. For their international operations, they expect the average daily margin to increase to $17,600, with a rig count of 88 to 89. The SANAD joint venture is projected to generate over $140 million in EBITDA in 2025 from new builds, with plans for five more rigs. Capital expenditures for 2025 are forecasted between $710 and $720 million, with $360 million allocated to the SANAD new builds. Nabors aims for breakeven free cash flow, excluding SANAD's negative free cash flow of approximately $150 million, while targeting a reduction in gross debt by generating $150 million of free cash flow outside SANAD.Nabors Industries Corporate Events
M&A TransactionsBusiness Operations and Strategy
Nabors Industries Acquires Parker Wellbore for Expansion
Positive
Oct 15, 2024
Nabors Industries has announced its acquisition of Parker Wellbore, aiming to strengthen its global drilling solutions business. The deal, involving the exchange of 4.8 million shares and $100 million in net debt, is set to enhance Nabors’ scale and leverage metrics. Parker, known for its tubular rental and repair services, complements Nabors’ portfolio, promising immediate cash flow benefits and significant synergy potential. The merger is expected to close in early 2025, pending customary approvals.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.