Nabors Industries Ltd (NBR): Today's Featured Basic Materials Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Nabors Industries ( NBR) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 2.1%. By the end of trading, Nabors Industries fell $0.47 (-3.1%) to $14.80 on heavy volume. Throughout the day, 9,205,037 shares of Nabors Industries exchanged hands as compared to its average daily volume of 5,040,900 shares. The stock ranged in price between $14.72-$15.62 after having opened the day at $15.00 as compared to the previous trading day's close of $15.27. Other companies within the Basic Materials sector that declined today were: Gasco Energy ( GSX), down 21.4%, Crosshair Energy ( CXZ), down 20.0%, Keegan Resources ( KGN), down 15.5% and Asanko Gold ( AKG), down 15.5%.
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Nabors Industries Ltd., together with its subsidiaries, operates as a land drilling contractor in the United States, Canada, and internationally. Nabors Industries has a market cap of $4.4 billion and is part of the energy industry. The company has a P/E ratio of 18.4, above the S&P 500 P/E ratio of 17.7. Shares are up 5.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Nabors Industries as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, good cash flow from operations and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and poor profit margins.

On the positive front, Noranda Aluminum ( NOR), down 34.9%, FX Energy ( FXEN), down 27.0%, Turquoise Hill Resources ( TRQ), down 16.6% and Magnum Hunter Resources Corportion ( MHR), down 15.3% , were all gainers within the basic materials sector with Schlumberger ( SLB) being today's featured basic materials sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the basic materials sector could consider Materials Select Sector SPDR ( XLB) while those bearish on the basic materials sector could consider ProShares Short Basic Materials Fd ( SBM).

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