Nabors Foresees 1Q14 Earnings Miss - Analyst Blog

Land drilling contractor Nabors Industries Ltd. NBR anticipates its first-quarter 2014 earnings per share EPS to lag the consensus estimates. A severe winter hampered the company's Completion Services business operations and is expected to result in the earnings miss. Nabors added that it will face an earnings shortfall of 7 cents per share owing to its Completion Services segment.  

Nabors' Completion Services segment comprises of pressure pumping activities. The company carries out majority of its pressure pumping operations in the Rocky Mountains and Appalachia basins. Inclement weather has affected the company's pressure pumping activities in the basins. However, Nabors expects its other operations to generate earnings at par with the company's expectation.  

Management believes the weak performance of the company's pressure pumping business in first-quarter 2014 will not continue for the remaining of the year due to improving demand.

Barbados-based Nabors conducts oil, gas, and geothermal land drilling operations and is the largest land-drilling contractor in the world. It is also one of the largest land well servicing companies and workover contractors in the U.S. The company offers a number of ancillary wellsite services, including oilfield management, engineering, transportation, construction, maintenance, well logging, and other support services in select domestic and international markets.

Nabors currently has a Zacks Rank #2 (Buy), implying that it is expected to outperform the broader U.S. equity market over the next one to three months.

One can also consider better-ranked stocks in the oil and gas drilling sector like Patterson-UTI Energy Inc. PTEN, New Source Energy Partners LP NSLP and Precision Drilling Corp. PDS. All the players sport a Zacks Rank #1 (Strong Buy).