Nabors Industries Ltd. (NYSE:NBR) Just Released Its Second-Quarter Earnings: Here's What Analysts Think

Shareholders of Nabors Industries Ltd. (NYSE:NBR) will be pleased this week, given that the stock price is up 18% to US$101 following its latest quarterly results. It was a pretty bad result overall; while revenues were in line with expectations at US$735m, statutory losses exploded to US$4.29 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Nabors Industries

Taking into account the latest results, the consensus forecast from Nabors Industries' eight analysts is for revenues of US$3.01b in 2024. This reflects a credible 2.8% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 60% to US$7.04. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$3.04b and losses of US$7.26 per share in 2024. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers were unchanged.

The average price target held steady at US$102, seeming to indicate that business is performing in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Nabors Industries, with the most bullish analyst valuing it at US$140 and the most bearish at US$79.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Nabors Industries shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Nabors Industries' growth to accelerate, with the forecast 5.7% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.1% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.5% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, Nabors Industries is expected to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Nabors Industries' revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$102, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Nabors Industries. Long-term earnings power is much more important than next year's profits. We have forecasts for Nabors Industries going out to 2026, and you can see them free on our platform here.

It might also be worth considering whether Nabors Industries' debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com