As of May 28, 2025, Nabors Industries Ltd's estimated intrinsic value ranges from $46.06 to $690.06 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $197.79 | +643.0% |
| Discounted Cash Flow (5Y) | $162.23 | +509.4% |
| Dividend Discount Model (Multi-Stage) | $46.06 | +73.0% |
| Earnings Power Value | $690.06 | +2492.3% |
Is Nabors Industries Ltd (NBR) undervalued or overvalued?
With the current market price at $26.62, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Nabors Industries Ltd's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 1.12 | 1.52 |
| Cost of equity | 9.0% | 13.4% |
| Cost of debt | 6.2% | 15.6% |
| Tax rate | 19.6% | 39.6% |
| Debt/Equity ratio | 6.09 | 6.09 |
| After-tax WACC | 5.6% | 10.0% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $162 | $4,828M | 78.8% |
| 10-Year Growth | $198 | $5,386M | 60.9% |
| 5-Year EBITDA | $46 | $3,008M | 66.0% |
| 10-Year EBITDA | $96 | $3,785M | 44.3% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $940M |
| Discount Rate (WACC) | 10.0% - 5.6% |
| Enterprise Value | $9,386M - $16,844M |
| Net Debt | $2,281M |
| Equity Value | $7,105M - $14,563M |
| Outstanding Shares | 16M |
| Fair Value | $453 - $928 |
| Selected Fair Value | $690.06 |
| Metric | Value |
|---|---|
| Market Capitalization | $418M |
| Enterprise Value | $2699M |
| Trailing P/E | 0.00 |
| Forward P/E | 126.88 |
| Trailing EV/EBITDA | 3.15 |
| Current Dividend Yield | 2.18% |
| Dividend Growth Rate (5Y) | -75.06% |
| Debt-to-Equity Ratio | 6.09 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 35% | $59.34 |
| Discounted Cash Flow (5Y) | 29% | $40.56 |
| Dividend Discount Model (Multi-Stage) | 24% | $9.21 |
| Earnings Power Value | 12% | $69.01 |
| Weighted Average | 100% | $209.54 |
Based on our comprehensive valuation analysis, Nabors Industries Ltd's weighted average intrinsic value is $209.54, which is approximately 687.2% above the current market price of $26.62.
Key investment considerations:
Given these factors, we believe Nabors Industries Ltd is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.