UPDATE: Goldman Sachs Upgrades Nabors Industries to Conviction Buy on Valuation Catalysts
Goldman Sachs upgraded Nabors Industries (NYSE: NBR) from Neutral to Conviction Buy and raised the price target from $17.00 to $23.00.
Goldman Sachs commented, "NBR is a key provider of shale exploitation services globally, but is trading at a 34% discount to our $24.75/share NAV estimate. We see catalysts to narrow the valuation gap, including: (1) Inflecting NAM rig activity leading to multiple expansion as in prior cycles; (2) margin inflection, as NBR is significantly under-earning with 4Q12E margins below mid-2009 levels; no other peer is that low; (3) cash release to shareholders from high FCF and stock underperformance; (4) corporate restructuring; and (5) around 15%+ IRR on our LBO screen."
Nabors Industries closed at $17.16 on Wednesday.
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