KeyBanc Starts Nabors (NBR) at Buy

KeyBanc initiated coverage on Nabors (NYSE: NBR) with a Buy rating and a price target of $35.00.

Analyst Robin Shoemaker said, "Today Nabors has a tailwind in the primary markets it serves: domestic and international contract drilling, domestic completion and production services, and the manufacture and sale of key drilling rig components. The tailwind has come at the right time, immediately following a major restructuring that strengthened the Company’s core businesses and made them more efficient and competitive. Beginning in 2H14, and continuing in 2015 and 2016, NBR’s financial results should provide ample evidence of the earnings power of the restructured and streamlined company. We think there is no doubt about the growing demand for Nabors’ PACE-X land drilling rigs, which are among the most technologically advanced rigs serving the multi-well pad drilling market."

"Thus far the E&P companies have awarded Nabors a total of 40 contracts (with either two-year or three-year terms) to build and operate PACE-X rigs. In a recent business update, Nabors reported that it is seeing “substantial improvements” in leading-edge dayrates for both its most technologically advanced rigs and its less advanced legacy rigs. The Company also has the wind at its back in its completions or hydraulic fracturing services business. Robust demand growth in 2014 has boosted the utilization of its fleet of fracturing equipment and, very recently, lifted pricing on several new contracts," she added.

For an analyst ratings summary and ratings history on Nabors click here. For more ratings news on Nabors click here.

Shares of Nabors closed at $24.14 yesterday.

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