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What the Market Said about Nabors Industries on February 12

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What the Market Said about Nabors Industries on February 12 PART 1 OF 5

A Look at Nabors Industries’ 1-Year Returns on February 12

Nabors Industries’ one-week returns versus the industry

Nabors Industries’ (NBR) one-year returns were -58.6% until February 12, 2018. In comparison, since February 13, 2017, the Energy Select Sector SPDR ETF (XLE) decreased 7.7%. 

The VanEck Vectors Oil Services ETF (OIH) witnessed -27.0% one-year returns. So, NBR underperformed OIH and XLE in the past year. NBR accounts for ~1.9% of OIH. NBR also underperformed the SPDR S&P 500 ETF (SPY) since February 13, 2017. SPY has produced 14.0% returns in the past year. 

A Look at Nabors Industries’ 1-Year Returns on February 12

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Crude oil price and rigs

On February 12, 2017, the West Texas Intermediate (or WTI) crude oil price was 12.0% higher compared to the previous year. Led by crude oil price’s strength, the rig count increased 30% in the US in the past year until the week ended February 9, 2018. You can learn more abut on energy prices in Market Realist’s Why Oil’s Decline Could Continue.

The recent factors that affected NBR’s returns include:

  • On January 16, 2018, Nabors Industries announced it raised debt of $800.0 million in a private placement offering. NBR plans to use the proceeds from this offering to repay its indebtedness.
  • On December 15, 2017, NBR completed the acquisition of Tesco Corporation.
  • Nabors Industries’ revenues increased 27.0% in 3Q17 over 3Q16. Compared to 2Q17, its revenues increased 5.0%.
  • NBR’s net loss deteriorated further in 3Q17 compared to 3Q16 and 2Q17.
  • NBR’s free cash flow (or FCF) was -$160.0 million in 3Q17 compared to -$23.6 million in 3Q16. Compared to 2Q17, this reflected deterioration. NBR was one of the lowest FCF generators in 3Q17. 

For more on free cash flow, please read Market Realist’s Ranking the Bottom 5 OFS Companies by Free Cash Flow.

Series highlights

In this series, we’ll look at Nabors Industries’ implied volatility, its correlation with crude oil, and Wall Street’s recommendations. We’ll discuss Nabors Industries’s stock price forecast next.

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