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The Nabors Industries (NYSE:NBR) Share Price Has Soared 385%, Delighting Many Shareholders

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Simply Wall St
·3 min read
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The Nabors Industries Ltd. (NYSE:NBR) share price has had a bad week, falling 16%. But over the last year the share price has taken off like one of Elon Musk's rockets. Few could complain about the impressive 385% rise, throughout the period. So the recent fall isn't enough to negate the good performance. Of course, winners often do keep winning, so there may be more gains to come (if the business fundamentals stack up).

Check out our latest analysis for Nabors Industries

Nabors Industries wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Nabors Industries actually shrunk its revenue over the last year, with a reduction of 30%. So it's very confusing to see that the share price gained a whopping 385%. It's pretty clear the market isn't basing its valuation on fundamental metrics like revenue. To us, a gain like this looks like speculation, but there might be historical trends to back it up.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth
earnings-and-revenue-growth

Take a more thorough look at Nabors Industries' financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Nabors Industries shareholders have received a total shareholder return of 385% over one year. Notably the five-year annualised TSR loss of 11% per year compares very unfavourably with the recent share price performance. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Even so, be aware that Nabors Industries is showing 2 warning signs in our investment analysis , you should know about...

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.