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Nabors Industries (NBR) Has Fallen 64% in Last One Year, Underperforms Market

Alex Smith
·4 mins read

If you are looking for the best ideas for your portfolio you may want to consider some of Miller Value Partners top stock picks. Miller Value Partners, an investment management firm, is bullish on Nabors Industries Ltd (NYSE:NBR) stock. In its Deep Value Strategies Q2 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Nabors Industries Ltd (NYSE:NBR) stock. Nabors Industries Ltd (NYSE:NBR) is an oil and gas drilling company.

On July 23, 2019, Miller Value Partners had released its Deep Value Strategies Q2 2019 investor letter. The investment firm said that it bought Nabors Industries Ltd (NYSE:NBR) stock in Q2 2019. Nabors Industries Ltd (NYSE:NBR) stock has posted a return of -63.7% in the trailing one year period, underperforming the S&P 500 Index which returned 15.1% in the same period. This suggests that the investment firm was wrong in its decision. On a year-to-date basis, Nabors Industries Ltd (NYSE:NBR) stock has fallen by 74.5%.

Let’s take a look at comments made by Miller Value Partners about Nabors Industries Ltd (NYSE:NBR) stock in the Q2 2019 investor letter.

"During the quarter we increased our weighting to the Energy sector, and Nabors Industries (NBR), highlighted in our Q4 2018 letter, became one of our top holdings. While it is possible in the near-term that Nabors may experience some volatility in U.S. rigs under contract, we see their operations stabilizing and improving over the next couple of years as they continue to improve their fleet mix to more profitable higher-end rigs and scale up their international and new service operations. Nabors should continue to generate strong free cash flow that should accelerate in 2020 and beyond. Success in continuing to de-lever the balance sheet should accrue significant value to shareholders. We believe the company is currently at more than a 75% discount to their long-term intrinsic value."

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Last month, we published an article revealing Miller Value Partners bullish investment thesis on Nabors Industries Ltd (NYSE:NBR) stock in its Q2 2020 investor letter. This suggests that the investment firm has been bullish for a long time on Nabors Industries Ltd (NYSE:NBR).

In Q1 2020, the number of bullish hedge fund positions on Nabors Industries Ltd (NYSE:NBR) stock decreased by about 5% from the previous quarter (see the chart here), so a number of other hedge fund managers don't seem to agree with Nabors' growth potential. Our calculations showed that Nabors Industries Ltd (NYSE:NBR) isn't ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds' poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost precious metals prices. So, we are checking out this junior gold mining stock. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. You can subscribe to our free enewsletter below to receive our stories in your inbox:

Disclosure: None. This article is originally published at Insider Monkey.