Land drilling contractor
Nabors Industries Ltd.
), anticipates that its operating results for the second quarter
of 2013 will fail to meet expectations.
According to Nabors, unsatisfactory performance from its 'Rig
Services' and 'Completion and Production Services' units will
lead to this lower-than-expected return. Decline in sales of
capital tools along with decreased rig services and rental
activities impair Nabors' Rig Services segment.
On the other hand, the Completion and Production Services unit
was affected by a tough competitive environment and severe
weather conditions. The company projects its operating income for
second-quarter 2013 to be between $88.0 million to $91.0 million.
However, Nabors has significantly lowered its gross debt by
roughly $300.0 million in this quarter.
Nabors believes that the results will improve from the later
quarters. The company is expected to release its second-quarter
results after the closing bell on 23 Jul, 2013. The Zacks
Consensus Estimate for earnings per share for the quarter stands
at 15 cents.
Barbados-based Nabors' high natural gas exposure raises its
sensitivity to gas price fluctuations. The company remains
particularly exposed to this situation since its North American
business is heavily biased to gas drilling.
Moreover, an imbalance in the demand-supply of rigs in the U.S.
land drilling market presents considerable risk for the company.
Additionally, the challenging near-to-intermediate term outlook
for Nabors' international business will likely hamper its
Nabors currently retains a Zacks Rank #4 (Sell), implying that it
is expected to underperform the broader U.S. equity market over
the next 1 to 3 months.
However, three firms in the energy sector with a favorable Zacks
PetroQuest Energy Inc.
Ferrellgas Partners LP
). All the stocks currently retain a Zacks Rank #1 (Strong
FERRELLGAS -LP (FGP): Free Stock Analysis
INTEROIL CORP (IOC): Free Stock Analysis
NABORS IND (NBR): Free Stock Analysis Report
PETROQUEST ENGY (PQ): Free Stock Analysis
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