Nabors Industries (NBR) and Noble (NE) Financial Analysis

Nabors Industries (NYSE: NBR) and Noble (NYSE:NE) are both oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Institutional & Insider Ownership

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87.2% of Nabors Industries shares are held by institutional investors. Comparatively, 87.8% of Noble shares are held by institutional investors. 4.1% of Nabors Industries shares are held by insiders. Comparatively, 1.0% of Noble shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.



Earnings and Valuation

This table compares Nabors Industries and Noble’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nabors Industries $2.57 billion 0.93 -$546.81 million ($1.63) -4.66
Noble $1.24 billion 0.91 -$516.51 million ($1.14) -3.99

Noble has lower revenue, but higher earnings than Nabors Industries. Nabors Industries is trading at a lower price-to-earnings ratio than Noble, indicating that it is currently the more affordable of the two stocks.

Dividends

Nabors Industries pays an annual dividend of $0.24 per share and has a dividend yield of 3.2%. Noble does not pay a dividend. Nabors Industries pays out -14.7% of its earnings in the form of a dividend. Nabors Industries has raised its dividend for 4 consecutive years.

Analyst Ratings

This is a summary of current recommendations and price targets for Nabors Industries and Noble, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nabors Industries 0 8 14 0 2.64
Noble 5 10 4 0 1.95

Nabors Industries currently has a consensus target price of $10.14, suggesting a potential upside of 33.63%. Noble has a consensus target price of $4.72, suggesting a potential upside of 3.68%. Given Nabors Industries’ stronger consensus rating and higher probable upside, research analysts plainly believe Nabors Industries is more favorable than Noble.

Profitability

This table compares Nabors Industries and Noble’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nabors Industries -21.32% -15.56% -5.77%
Noble -41.76% -4.61% -2.55%

Volatility and Risk

Nabors Industries has a beta of 1.6, suggesting that its share price is 60% more volatile than the S&P 500. Comparatively, Noble has a beta of 2.19, suggesting that its share price is 119% more volatile than the S&P 500.

Summary

Nabors Industries beats Noble on 10 of the 17 factors compared between the two stocks.

About Nabors Industries

Nabors Industries Ltd. provides drilling and drilling-related services and technologies for land-based and offshore oil and natural gas wells. It operates through five segments: U.S., Canada, International, Drilling Solutions, and Rig Technologies. The company offers equipment manufacturing, rig instrumentation, optimization software, and directional drilling services. It also provides patented steering systems and rig instrumentation software systems, including ROCKIT directional drilling system that offers data collection services to oil and gas exploration and service companies; REVit control system, a stick slip mitigation system; RIGWATCH software, which monitors a rig's real-time performance and provides daily reporting for drilling operations; and DrillSmart software that allows the drilling system to adapt operating parameters and drilling conditions. In addition, the company offers measurement while drilling (MWD) systems and services, such as AccuMP mud pulse MWD system, which is designed to address the various MWD reliability issues; AccuWave collar mounted Electromagnetic MWD system that addresses the needs of the land market through the technology and design techniques; and Nabors' AccuSteer Measurement While Drilling (M/LWD) Suite, which is a premier dynamics evaluation MWD system for performance drilling with integrated advanced geosteering measurements. Further, it manufactures and sells top drives, catwalks, wrenches, draw works, and other drilling related equipment, such as robotic systems and downhole tools; and provides automated tubular and tool handling equipment. As of December 31, 2017, the company marketed approximately 407 rigs for land-based drilling operations in the United States and Canada, as well as in 20 other countries worldwide; and 38 rigs for offshore drilling operations in the United States and internationally. Nabors Industries Ltd. was founded in 1952 and is headquartered in Hamilton, Bermuda.

About Noble

Noble Corporation plc operates as an offshore drilling contractor for the oil and gas industry worldwide. It provides contract drilling services using mobile offshore drilling units. As of December 31, 2017, the company operated a fleet of 8 drill ships, 6 semisubmersibles, and 14 jack ups. Noble Corporation plc was founded in 1921 and is headquartered in London, the United Kingdom.

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