Should Value Investors Buy Nabors Industries (NBR) Stock?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Nabors Industries (NBR). NBR is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 12.09 right now. For comparison, its industry sports an average P/E of 15.12. Over the past 52 weeks, NBR's Forward P/E has been as high as 12,118.52 and as low as -1,466.05, with a median of -4.72.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. NBR has a P/S ratio of 0.61. This compares to its industry's average P/S of 1.72.
PattersonUTI Energy (PTEN) may be another strong Oil and Gas - Drilling stock to add to your shortlist. PTEN is a # 2 (Buy) stock with a Value grade of A.
PattersonUTI Energy also has a P/B ratio of 2.23 compared to its industry's price-to-book ratio of 1.29. Over the past year, its P/B ratio has been as high as 2.72, as low as 1.42, with a median of 2.14.
These are only a few of the key metrics included in Nabors Industries and PattersonUTI Energy strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, NBR and PTEN look like an impressive value stock at the moment.
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Nabors Industries Ltd. (NBR) : Free Stock Analysis Report
Patterson-UTI Energy, Inc. (PTEN) : Free Stock Analysis Report
