In a report published Wednesday, RBC Capital Markets analyst Kurt Hallead upgraded Nabors Industries NBR to Outperform from Sector Perform, raising its price target from $19.00 to $20.00.
According to the report, for 2014, it is believed that NBR will benefit from the strong Tier 1 rig market as well as a ramp in Int'l drilling in 2H14.
“In 2013, Tier 1 rig utilization has increased to ~94% from ~85% at the beginning of the year,” the report noted. “The industry is currently in the process of shifting toward more of these rigs, which command higher day rates than older Tier 2 and 3 rigs and are preferable for complex, efficient, horizontal drilling in US shale plays.”
Some highlights from the report included:
-”Increasing '14/'15 EPS estimates to $1.16/$1.66.”
-”We expect NBR to add +30 newbuild Tier 1 rigs to its fleet over the next
two years and maintain their ~20% share of industry Tier 1 rigs.”
-”We forecast that ~33% of NBR's EBITDA will be derived from Tier 1 rigs in 2015, compared to 17% in 2011.”
NBR closed Tuesday at $16.74.
Market News and Data brought to you by Benzinga APIs© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
---|
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in