Nabors and Patterson-UTI Gets Technical Coverage: Oil Drilling Stocks Recovering from Supply Glut

    Nabors and Patterson-UTI Gets Technical Coverage: Oil Drilling Stocks
                         Recovering from Supply Glut

  PR Newswire

  LONDON, January 25, 2013

LONDON, January 25, 2013 /PRNewswire/ --

Oil and gas industry is lately been plagued by uncertainty in international
oil prices. Demand and supply mismatched coupled with constant pricing
pressure is detrimental to all the component sub-sectors of the industry. The
sector lagged behind the returns offered by S&P 500 and disappointed the
investors. StockCall technical analysts posted their recent research on Nabors
Industries Ltd. (NASDAQ: NBR) and Patterson-UTI Energy Inc. (NASDAQ: PTEN).
These reports are free of charge and can be downloaded now at  

Oil and gas drillers and exploration companies are not immune to this malady
either. However, there are a couple of quality-drilling companies with solid
fundamentals, which can weather the storm and still provide good returns to
the investors. Nabors Industries is among the leaders in oil and gas
exploration sector. The company is currently being touted as a potential
takeover target, which may lead to substantial value creation for the
stockholders. Similarly, Patterson-UTI Energy Inc. [ Free Report on PTEN ] ^[
^1 ^] , a provider of services to drillers and oil exploration companies, is
likely to benefit from fall in gas reserves in the U.S.

Nabors to Focus on Drilling

Nabors Industry offered negative returns in the past 12 months and the
pressure of declining oil and gas prices is clearly visible through its stock
price, which has consistently trailed down since early 2012, but picked up
later in the year. The driller is currently being scrutinized for its rather
lax management. Nabors Industry is planning to consolidate its position and
focus on drilling operations. It is planning to hive off its non-core assets
like logistic operations and oil field stakes. The main area of the concern is
the lack of activity on the part of management. Despite the fact that Nabors
decided to sell its non-core assets early last year, the process is still
under progress and has not made much headway. Sign up today and read StockCall
analysis on Nabors Industries at

However, the stock is currently trading at attractive valuations and thus
offers good entry price point. It is expected to infuse additional liquidity
with its plans to sell off its non-essential assets. The sale is likely to add
as much as $800 million to its coffers. Oil and gas demand is also expected to
bottom out and is likely to ease pressure on the company. Nabors is also
expected to address its internal operational issues, as its bigger investors
including Pamplona Capital Management have started to exert influence over the

Patterson-UTI Energy and Increase in Drilling Activities

Patterson-UTI Energy changed guards last year and its new CEO is bringing
about a shift in focus. The stock, like its peers, remained under pressure in
2012 but picked up later in the year, thanks to better demand and supply ratio
in the market. The company is also improving its drilling fleet, which will
bring about better efficiency. Patterson-UTI Energy is one of the largest
on-shore contract drillers and is expected to benefit from renewed interest in
drilling activities. Apart from fundamentals, the stock also has attractive
multiples. It is trading at Price Earnings ratio of 9.40, making it an
inexpensive stock to own.

Oil and energy is sector is expected to come out of its supply excess in year
2013 and the pressure on the stocks is also likely to ease. In such case,
fundamentally strong stocks like Nabors and Patterson-UTI Energy are well
positioned to show good rally.


1.Patterson-UTI Energy Inc. Technical Analysis [ ]

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