Nabors Industries Rebuilding Energy Profits

Thursday, 12 Jan 2012 06:45 AM

By Tim Plaehn

  Comment  |
   Contact Us  |
|  A   A  
  Copy Shortlink
Drilling services company Nabors Industries (NBR) suffered some setbacks in mid-2011, but now the company is poised to start rebuilding its profits on the growth in North American energy production.

Nabors Industries manufactures and leases oil and natural gas drill rigs and well service rigs. The company also provides service crews and is one of the largest providers of hydraulic pumping services, required for many of the new natural gas regions.

Company operations are focused on United States, Alaska, and Canada land drilling, offshore rigs and international rigs, both land and offshore, jack-up types. The U.S. land drilling segment generates the largest amount of operating income, followed by the pressure pumping division.

Other segments generating a significant portion of operating income include international operations, Canada operations and what Nabors calls "other operating segments."

For the first three quarters of 2011, Nabors Industries reported net income from operations of $282 million or 96 cents per share, up from $172 million or 59 cents per share for the same period of 2010.

For the full year 2011, the consensus earnings estimate is $1.47 per share, compared to earnings of $1.13 in 2010. The Wall Street 2012 average earnings estimate is $2.27 per share.

Cashing out

Nabors Industries owns a portfolio of oil and gas exploration and production assets which the company states it wants to "expeditiously monetize." Of the $2.1 billion invested in these assets, $855 million has been "monetized," leaving more than $1.2 billion of assets the company would like to turn into cash.

As these assets are sold off, the proceeds will be used to reduce the company's debt load, increasing financial flexibility.

Like many companies in the energy production sector, the forecasts for Nabors Industries cover a wide range of possible results. The Wall Street earnings estimates for 2012 range from a low of $1.77 per share to a high of $2.76. Note that the entire range is well above 2011 earnings.

Recently, the analysts at BMO Capital Markets upgraded NBR to outperform from market perform with a target price 50 percent above the current share value.

The company next reports on Feb. 14.

© 2014 Moneynews. All rights reserved.

  Comment  |
   Contact Us  |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
Retype Email:
Zip Code:
Privacy: We never share your email.
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Goldman, US Agency in Mortgage Settlement Worth $1.2 Billion

Friday, 22 Aug 2014 21:30 PM

Goldman Sachs has agreed to a settlement worth $1.2 billion to resolve claims that it misled U.S. mortgage giants Fannie . . .

Cop Who Pushed CNN Anchor in Ferguson Suspended Over Racist Speech

Friday, 22 Aug 2014 21:41 PM

A St. Louis County police officer who pushed back a CNN anchor during a live broadcast from Ferguson, Missouri, this wee . . .

Kudlow: Obama Using 'Left-wing Populist Tricks and Class Warfare'

Friday, 22 Aug 2014 19:08 PM

Badly behind in the polls, Team Obama is resorting to its old left-wing populist tricks, says renowned economist and CNB . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

America's News Page
©  Newsmax Media, Inc.
All Rights Reserved