Nabors (IL/A): Strong 2Q EPS, raising fair value to $80 = 19% upside
Goldman Sachs July 28, 2005
We are raising our 2005-2007 EPS estimates for NBR to $3.80/ $5.00/ $5.80 from $3.40/ $4.20/ $5.00 based on stronger demand and pricing trends across NBR's business mix, particularly US land drilling and workover and Int'l land drilling. We are also raising our fair value to $80 (9x 2006E EV- EBITDA) from $71 = 19% upside potential. 2Q2005 EPS of $0.82 beat our estimate of $0.76 and $0.73 consensus w/ EBITDA 6% above expectations. Int'l, US Offshore (aided by an insurance settlement), US land and Other were above expectations w/ Canada below. NBR bought-back stock for the first time in 4 years and increased 2005 capex guidance 54% = bullish for NOV. We maintain our IL/A rating, seeing solid upside in NBR shares, but better risk reward in BHI, SII, SLB, RIG + DO.
I, Terry Darling, hereby certify that all of the views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in this repo |
