Nabors Industries(NBR) Message Board

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Gold/Mining/Energy : Nabors Industries(NBR)

NBR 48.52

-1.7%

Oct 31 9:30 AM EDT

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To: Dennis Roth who wrote (159)	10/6/2007 5:07:56 AM
From: Dennis Roth	of 174

Nabors preannounced ... again - Goldman Sachs 10/05/07 News Nabors preannounced 3Q2007 EPS of $0.73-$0.76 vs. our $0.78 and consensus of $0.81. The company also expects 4Q2007 EPS to below consensus of $0.89--we are at $0.81. The outlook for 2008 was also reduced to a level that will be essentially flat or slightly lower than 2007. Analysis We expect this to be negative for Nabors' shares in the near term but do not believe the news was entirely unexpected. We would note that this is not the first time Nabors preannounced this year. Following the 4Q2006 (January 2007) preannouncement, the stock traded down 1.4% relative to the OSX but 5.8% in absolute and traded down almost 3% relative to the group the day of the 1Q2007 (March 2007) preannouncement. The reduction in the outlook for 2008 was entirely related to the company's North American businesses (ex Alaska). Expectations for strength in the International and Alaskan operations were confirmed, which is consistent with our current assumption. We believe consensus expectations for 2008 were previously too high but note that our below-consensus estimate (-5%) still assumes 12% growth in 2008 operating income over 2007. Implications We believe this could create an attractive buying opportunity if the shares sell off. We continue to view $28 as a floor value and view the $28-$30 range as a potentially attractive entry point based on recent trough trading levels and asset values. Our estimates and price target are under review.

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