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Nabors (NBR) Soars 15.1%: Is Further Upside Left in the Stock?

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Nabors Industries (NBR - Free Report) shares soared 15.1% in the last trading session to close at $124.45. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 33.4% gain over the past four weeks.

Nabors Industries stock rose for the sixth time in eight days, driven by improving outlook for the industry. In a presentation yesterday, oilfield service biggie Schlumberger (SLB - Free Report) painted an optimistic picture of the energy sector, asserting the strong fundamentals and an imminent growth cycle. As it is, the rally in crude prices to a multi-year high of around $68 a barrel on the back of calibrated OPEC+ cuts and an upbeat demand forecast has lifted the onshore contract drilling space and contributed to the strength in the company.

Price and Consensus

Price Consensus Chart for NBR

This drilling contractor is expected to post quarterly loss of $16.96 per share in its upcoming report, which represents a year-over-year change of -17.4%. Revenues are expected to be $465.1 million, down 13.2% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Nabors, the consensus EPS estimate for the quarter has been revised 2.5% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on NBR going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

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