Nabors Industries (NBR) Stock Up Amid Rising Oil Prices

NEW YORK (TheStreet) -- Shares of Nabors Industries  (NBR) were up 1.58% to $14.76 in afternoon trading Friday, as oil prices rally to trade in the green on lower drilling rig count, according to Reuters.

Data by Baker Hughes (BHI) showed that energy firms pulled 13 rigs from U.S. oil fields this past week, the biggest decline in four weeks, Reuters noted.

The weekly decline marked 25 straight weeks of declines, bringing the total rig count to its lowest level in nearly five years to 646 rigs.

Brent crude for July delivery is higher by 4.46% to $65.37 a barrel as of 3:29 p.m. ET, while WTI crude is also up, 4.35% to $60.19 a barrel as of 3:28 p.m. ET today.

Bermuda-based Nabors is a provider of services for land-based and offshore oil and natural gas wells.

The company's business line is made up of drilling rig operations and drilling-related services and directional drilling services.

Separately, TheStreet Ratings team rates NABORS INDUSTRIES LTD as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:

"We rate NABORS INDUSTRIES LTD (NBR) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 144.0% when compared to the same quarter one year prior, rising from $50.67 million to $123.63 million.
  • 35.00% is the gross profit margin for NABORS INDUSTRIES LTD which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.73% is above that of the industry average.
  • NABORS INDUSTRIES LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NABORS INDUSTRIES LTD swung to a loss, reporting -$2.35 versus $0.51 in the prior year. This year, the market expects an improvement in earnings (-$0.16 versus -$2.35).
  • Net operating cash flow has decreased to $307.17 million or 30.90% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Energy Equipment & Services industry and the overall market, NABORS INDUSTRIES LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: NBR Ratings Report

More from Markets

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Legal Weed Sales in California Are Off to a Less Than Smokin' Start

Legal Weed Sales in California Are Off to a Less Than Smokin' Start

Owner of Moviepass Sees Stock Plummet

Owner of Moviepass Sees Stock Plummet

Ford, GM Gain as China Slashes Auto Import Tariffs

Ford, GM Gain as China Slashes Auto Import Tariffs

U.S. Crude Oil Hits Fresh 3-Year Highs as Gasoline Heads to $3 a Gallon

U.S. Crude Oil Hits Fresh 3-Year Highs as Gasoline Heads to $3 a Gallon