Nov. 25, 2014, 10:13 AM
- C&J Energy Services (CJES +3.6%) says it plans to appeal a Delaware court ruling that requires it to solicit offers from other buyers for 30 days before it can merge with a unit of Nabors Industries (NBR -0.5%).
- NBR announced in June that it would merge its completion and production business with CJES and receive $2.86B in cash and stock; the deal is structured as a Reverse Morris Trust, a transaction that allows a parent company to sell its unit in a tax-efficient manner.
- But CJES shares are higher, as investor appetite for the deal had been waning given the integration risk and less favorable industry outlook.
Nov. 24, 2014, 9:49 PM
- A Delaware court today ordered a 30-day hold on the C&J Energy (NYSE:CJES) acquisition of a Nabors Industries (NYSE:NBR) unit, finding C&J’s board did not adequately shop the company and telling it to feel out other potential buyers, WSJ reports.
- The deal, announced in June, was unusual as CJES was the nominal buyer, agreeing to pay NBR 62.5M shares and $940M in cash for the fracking services unit, but NBR is to retain control of the combined entity with a 53% stake to CJES shareholders’ 47%.
- The judge found that because CJES shareholders essentially were turning over control of their investment to NBR, the deal was subject to a corporate law theory that required the board to take steps to get the best possible price.
Nov. 11, 2014, 3:46 PM
- Nabors Industries (NBR -0.3%) reported revised Q3 earnings from continuing operations of $0.34/share, compared to the $0.19 previously reported on Oct. 21.
- NBR says the revision is due to a change in the non-cash income tax provision for Q3, with the previously reported $63.3M non-cash charge related to the restructuring of the company's completion and production entities in preparation for the pending transaction with C&J Energy should be reduced to $18.3M.
- After the revision, the total income tax provision for Q3 is $61.5M vs. the $106.5M previously reported, and net income is $106.4M vs. $61.4M previously reported.
Oct. 24, 2014, 8:41 AM| Comment!
Oct. 22, 2014, 6:52 PM
- Nabors Industries (NYSE:NBR) fell today along with most energy companies as oil prices resumed their recent slide, but CEO Anthony Petrello sees something of a silver lining through the market for the company's advanced drilling rigs.
- If oil prices hover ~$80/bbl, producers will aim to drill more efficiently, prompting them to turn to NBR’s newest models - which may offset declines in U.S. drilling activity - Petrello said in today's earnings conference call.
- "We can’t eliminate the risk [of falling commodity prices] but we can do our best to minimize it," the CEO said.
- The advanced rigs may be eating into the U.S. market for old mechanical models, but some of the aging units have found a home in North Dakota, where Petrello says "they perform really well, [and] we’re going to keep running them until they’re no longer useful.”
Oct. 21, 2014, 7:09 PM
- Nabors Industries (NYSE:NBR) +3% AH after Q3 earnings rose 26% Y/Y and beat Wall Street estimates, thanks to higher activity in the Bakken shale field in North Dakota and Permian Basin in Texas.
- Total revenue rose 17%, its highest increase in nine quarters, to $1.81B; sales in the completion and production services business, which handles the post-drilling processes used to extract oil and gas, rose 19% to $612M despite two Pacific hurricanes crossing into Texas during the quarter.
- NBR says the recent fall in oil prices could affect customer spending, but that it is "much better positioned to weather and potentially capitalize upon any significant downturn in industry activity" because of steps taken to improve financial flexibility, streamline operations and improve cost structure.
- Onshore drillers such as NBR should be less affected by falling oil prices than offshore drillers, whose customers need higher prices to break even.
Oct. 21, 2014, 4:46 PM
Oct. 20, 2014, 5:35 PM
Oct. 17, 2014, 3:17 PM
- UBS is upgrading the U.S. land drillers, believing that the selloff in the sector has been overdone, even assuming a more cautious North America environment.
- The firm stresses that buying the land drillers is partially a play on oil prices - it sees upside risk of 40%-80% if oil prices return to $90/bbl for WTI but downside risk of 25% if oil prices slide to $75 for a sustained period of time - but it says underlying industry fundamentals also are positive and the demand for pad-capable rigs will grow.
- Helmerich & Payne (HP -2.1%), Nabors Industries (NBR +1.1%) and Patterson-UTI Energy (PTEN +0.2%) are all upgraded to Buy from Neutral.
Oct. 9, 2014, 3:43 PM
- Offshore drillers have company now that falling oil prices are hitting the shares of land drillers such as Helmerich & Payne (HP -3.7%), Patterson-UTI (PTEN -6.8%), Nabors Industries (NBR -4.7%) and Seventy Seven Energy (SSE -5%) - with good reason, Susquehanna analysts say.
- The firm views land drillers at considerable risk to estimate revisions, given high current dayrates and significant newbuild construction activity, which could be problematic if lower crude prices persist or a weaker outlook on U.S. E&P spending comes out of earnings season.
- Nevertheless, the firm finds valuations much better in land drilling for now, and it prefers PTEN and NBR at a respective 3.7x and 4.5x 2015 EBITDA.
Sep. 24, 2014, 3:13 PM
- Nabors Industries (NBR +1.3%) is outpacing most energy-related companies on the day as Wells Fargo initiates coverage with an Outperform rating and a $28-$32 valuation range, based on a belief that NBR shares are undervalued given the growth prospects of the U.S. land rig fleet and pressure pumping business.
- The firm forecasts NBR's margin/rig day to increase from slightly more than $10K in Q2 to average almost $11.3K in 2015 and $12K in 2016, benefiting from higher rates and taking delivery of additional newbuilds over the next 12 months.
Sep. 11, 2014, 3:59 PM
- Nabors Industries (NBR +0.3%) says it will repurchase 10.375M of its common shares representing ~40% of Pamplona Capital's position in the company at $24.10/share, for a total of ~$250M.
- NBR says the transaction is accretive to current earnings per share,
- NBR shares dropped early on word of Pamplona's sale before bouncing up again.
Sep. 11, 2014, 9:14 AM| Comment!
Aug. 12, 2014, 5:28 PM
- Schlumberger (NYSE:SLB) expects the economic sanctions in Russia will have a small financial impact on its operations in the country, but RBC analysts see SLB impacted more by the instability in Iraq.
- The firm estimates SLB gains ~$600M from annual Iraq revenue ($0.06-$0.08 in EPS) with operating margins of ~20%, so it lowers its 2014 EPS forecast to $5.56 from $5.64 as well as its 2015 ooutlook to $6.63 from $6.70; however, the firm maintains its stock price target at $129.
- Other companies with large exposure to Russia also fell today, including Weatherford (NYSE:WFT), Nabors Industries (NYSE:NBR), Halliburton (NYSE:HAL) and Baker Hughes (NYSE:BHI).
Jul. 22, 2014, 5:36 PM
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