NBR walks into its Q2 print today with the stock having shed 11% over the past week and nearly 4% in Tuesday's session alone, closing at $75.64. Short interest, running at 7.1% of the free float, has built modestly over the past month — up around 4.6% — even as it dipped slightly in the most recent week. The put/call ratio tells a more striking story: at 1.96, it is well above the midpoint of its 52-week range (low of 0.84, high of 2.53) and has been grinding higher over the past two weeks, reflecting sustained demand for downside protection. Borrow conditions offer no squeeze threat — availability is deeply loose at roughly 1,444%, meaning shares to borrow are vastly more plentiful than the current short interest, and borrowing costs have eased 12% on the week to just 0.50%.
The analyst community is caught between an optimistic consensus and a freshly cautious revision. The Street's mean price target sits at $106 — implying roughly 40% upside from here — but Susquehanna cut its target from $105 to $85 on July 8, citing deteriorating near-term conviction while keeping a Neutral rating. That move is the most recent signal in a longer arc: a wave of target increases followed Q1 results in late April, when Morgan Stanley lifted to $100 and Piper Sandler pushed to $120. The bull case rests on rising day margins — now at $17,931, up about $846 per day year-on-year — and the Saudi SANAD build cycle providing visible revenue. The bear case is harder to dismiss: a $2.5 billion debt maturity wall over the next seven years and a recurring pattern of collection shortfalls in Mexico (a $30 million revenue miss in Q3 2025 being the latest) keep leverage risk front and centre.
The contrast between the bulls' structural thesis and the bears' balance sheet concern is sharpest when viewed through valuation. The EV/EBITDA multiple has compressed about 12 turns over the past 30 days, now running at 3.7x — a historically low reading that value-oriented investors cite as a margin of safety. At the same time, the forward earnings picture looks fragile: the EPS momentum factor score over the past 90 days ranks in just the 2nd percentile, meaning almost no stock in the universe has seen a sharper downward revision trend. BlackRock's position — now 8.8% of shares after adding 157,000 shares through June — provides some institutional backing, while Adage Capital trimmed aggressively earlier in the year. The stock is down sharply even as several close peers also weakened: PTEN fell 7.7% on the day and HP dropped 4.8%, suggesting sector headwinds rather than company-specific selling, though NBR's relative underperformance over the week stands out.
The print will test whether Nabors can show enough free cash flow generation to reframe the leverage narrative — and whether Saudi-driven margin improvements are durable enough to justify a share price that still sits more than 25% below the Street's consensus target.
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