This company provides drilling and rig services. Nabors Industries Ltd. (NYSE: NBR) offers rig instrumentation, optimization software and directional drilling services. It also provides completion, life-of-well maintenance and plugging and abandonment of a well. In addition, the company markets approximately 466 land drilling rigs for oil and gas land-based drilling operations in the United States, Canada and approximately 20 other countries worldwide; approximately 445 rigs for land well-servicing and workover services in the United States; 98 rigs for land well-servicing and workover services in Canada; 42 rigs for offshore drilling operations in the United States and internationally; and seven jackup units and components of trucks and fluid hauling vehicles.
Nabors posted earnings after the closing bell Tuesday. While the company slightly missed on the bottom line, the revenues came in above expectations and guidance was not as draconian as perhaps many analysts were expecting. Company management felt that the third quarter may even mark the bottom of the downturn.
Nabors investors are paid a 2.1% dividend. The JPMorgan price target is set at $21, and the consensus price objective is $17.30. Shares closed Tuesday at $11.48. Hitting the target would be a massive 80% gain.
Superior Energy Services
Superior Energy Services Inc. (NYSE: SPN) serves the drilling, completion and production-related needs of oil and gas companies worldwide through its brand name drilling products and its integrated completion and well intervention services and tools, supported by an engineering staff who plan and design solutions for customers.
Some Wall Street analysts feel that Superior could be one of the biggest beneficiaries of potential divestitures coming from the Baker Hughes and Halliburton merger. The company is one of Wall Street’s favorite small to mid-cap stocks to play the U.S. land services recovery, and analysts think investors should see the impact of cost reductions as this year progresses, which some feel could help offset pricing pressure.
Superior investors are paid a 1.92% dividend. The JPMorgan price target $29, and the consensus target is $25.30. The stock closed Tuesday at $16.65. Hitting the target would be a monster 75% gain.
Some Wall Street analysts feel that owning Weatherford is almost a derivative type play on the revenue fallout from the Halliburton and Baker Hughes deal. Weatherford International Ltd. (NYSE: WFT) has been cut almost 50% since the highs the stock printed last summer, and it was forced to cut 8,000 jobs back in early February, almost 15% of the company’s total workforce. The company still offers customers a wide range of global capabilities, including a proprietary system for pressure management in the mushrooming arena of subsea production. The changes in government oil policy in Mexico last year may provide some favorable tailwinds for the company, despite the huge downturn in oil pricing.
The JPMorgan price objective is $19, while the consensus target is posted at $14.75. The stock closed on Tuesday at $10.37. Hitting the target would be over an 80% gain.
The oil services trade is still a contrarian one to say the least. Oil seems to have hit bottom late last year, turned much higher and has totally rolled back over. The pain in the industry is not going away anytime soon, so sticking with the top companies with big upside potential makes good sense, and patient investors may see giant upside from current trading levels.
Sponsored: Find a Qualified Financial Advisor
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.