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NE

Noble Corporation

$31.07 USD 4.85B market cap February 1, 2026
Noble Corporation plc NE BUFFETT / MUNGER / KLARMAN SUMMARY
1 SNAPSHOT
Price$31.07
Market CapUSD 4.85B
EVUSD 6.85B
Net DebtUSD 1.84B
Shares152M
2 BUSINESS

Noble Corporation is the world's second-largest offshore drilling contractor, operating a fleet of 41 rigs (28 floaters, 13 jackups) serving oil and gas companies in deepwater and harsh environment drilling worldwide. Revenue comes from day rate contracts with major oil companies (ExxonMobil, Shell, Petrobras). The company was formed through the 2022 merger of Noble and Maersk Drilling, and acquired Diamond Offshore in September 2024.

Revenue: USD 3.06B Organic Growth: +18% (2024 vs 2023)
3 MOAT NARROW

Narrow moat from scale (#2 globally with 41 rigs) and premium fleet quality (15 of 17 7th-generation drillships, industry-leading MPD capabilities). However, offshore drilling is fundamentally a commodity business with day rates set by supply/demand. No sustainable pricing power or switching costs. Long-term customer relationships (ExxonMobil Guyana) provide some stability but can be terminated at contract end.

4 MANAGEMENT
CEO: Robert Eifler (since 2022 merger)

Strong track record: $800M+ returned to shareholders since Q4 2022 merger via dividends and buybacks. Successfully integrated Maersk Drilling (achieved $150M synergies vs $125M target) and Diamond Offshore (on track for $100M synergies). Shareholder-friendly but buybacks occurred at elevated prices ($40+ average). Maintained $0.50/quarter dividend through cycle.

5 ECONOMICS
19.8% Op Margin
~8% ROIC
USD 80M (2024, depressed by high CapEx) FCF
1.8x Debt/EBITDA
6 VALUATION
FCF/ShareUSD 0.53 (depressed)
FCF Yield1.7% (depressed by Diamond integration)
DCF RangeUSD 26 – 39

Normalized EBITDA $900M, Maintenance CapEx $350M, 10-15x multiple. At 12x owner earnings ($2.63/share), fair value = $31.56. Highly sensitive to oil price cycle and contracting momentum.

7 MUNGER INVERSION -48.8%
Kill Event Severity P() E[Loss]
2025 utilization worse than expected (white space persists) -30% 40% -12.0%
Oil price crash below $50/barrel sustained -60% 15% -9.0%
Dividend cut or suspension -25% 25% -6.3%
Contract repricing at lower day rates -15% 30% -4.5%
Energy transition acceleration reduces offshore demand -40% 10% -4.0%

Tail Risk: Major operational accident (Deepwater Horizon scenario) could combine with oil price crash to create 70%+ permanent loss. Offshore drilling has demonstrated it can go to zero (Noble's 2020 bankruptcy). Pabrai's 86% position reduction suggests near-term EBITDA disappointment risk is elevated.

8 KLARMAN LENS
Downside Case

If oil prices fall to $50-60 and offshore CapEx is deferred, Noble's EBITDA could contract to $600-700M. At 5x EV/EBITDA trough multiple, equity value would be $1.5-2.0B ($10-13/share). Dividend would likely be cut. Stock traded at $17.40 in April 2025 - could revisit those levels.

Why Market Wrong

Market may be underweighting (1) the structural improvement in industry supply/demand after 2014-2021 bust, (2) $6.2B backlog providing 2-year visibility, (3) capital return discipline, and (4) potential for 2026 contracting rebound as FPSO delays resolve.

Why Market Right

The bears are likely correct that: (1) 2025 will be a difficult year with utilization below 70%, (2) day rates for 6th-gen rigs are under pressure, (3) the dividend may not be sustainable if EBITDA disappoints, and (4) Pabrai's exit signals near-term pain. At $31, the stock is priced for execution, not margin of safety.

Catalysts

1. 2H 2025 contracting pickup (management expects utilization rebound) 2. Oil price recovery above $85/barrel 3. Guyana expansion announcements 4. Diamond synergy realization ($100M target) 5. CapEx normalization improves FCF in 2025-2026

9 VERDICT WAIT
B T3 Adaptable
Strong Buy$22
Buy$25
Sell$47

Noble Corporation is a quality offshore driller trading at fair value (~7x EV/EBITDA) with an 8%+ dividend yield, but offers no margin of safety at current prices. The 9.6% ROE fails Buffett's 15% test, the moat is narrow, and Mohnish Pabrai's 86% position reduction from Q1 to Q3 2025 is a major warning signal. Wait for $22-25 entry (30-20% below fair value) or clearer evidence of 2025-2026 EBITDA stabilization before considering a position.

🧠 ULTRATHINK Deep Philosophical Analysis

NE (Noble Corporation) - Ultrathink Analysis

The Real Question

What problem are we actually solving by investing in Noble Corporation?

We are betting that the world will continue to need offshore oil and gas for decades, that the 2014-2021 industry bust created lasting supply discipline, and that Noble's premium fleet position will translate into durable competitive advantage.

But this is not really the question. The real question is: Are we buying an asset or a business?

If Noble is an asset (a collection of floating drilling rigs), then the question is whether we are paying less than liquidation value. We are not. The rigs could be worth $2B-4B in distress, but we are paying $7B enterprise value.

If Noble is a business, then the question is whether it can earn attractive returns on capital through a full cycle. With ROE of 9.6% (below cost of equity), ROIC of 8% (barely above WACC), and a commodity-like business model with no pricing power, the answer appears to be: barely.

The truth: Noble is a mediocre business that occasionally generates excellent returns during tight supply cycles. We are being asked to pay fair value for the chance to capture the next upcycle. This is speculation dressed as value investing.

Hidden Assumptions

What assumptions is the market making that might be wrong?

  1. The market assumes 2025 will be difficult. This is priced in. The hidden assumption is that 2026+ will be better. If offshore E&P spending is structurally impaired by energy transition, the "recovery" may be smaller and shorter than the market expects.

  2. The market assumes $6.2B backlog = visibility. Hidden assumption: contracts will be honored at stated rates. In reality, customers have cancelled contracts before (Tullow early release mentioned in transcripts). Backlog is a promise, not cash.

  3. The market assumes dividends are safe at 8% yield. Hidden assumption: EBITDA will remain above $900M. If EBITDA falls to $700M, the $300M annual dividend becomes 43% of EBITDA before interest and CapEx. It would be cut.

  4. The market assumes Diamond integration is going well. Hidden assumption: announced synergies will be captured and there are no skeletons in Diamond's closet. Integration is 6 months old - too early to declare victory.

  5. The market assumes Pabrai's exit is idiosyncratic. Hidden assumption: his shift to Transocean is about relative value, not absolute value destruction at Noble. But Pabrai sold at $28-30, below current prices. He may know something about near-term EBITDA that we don't.

The Contrarian View

What would have to be true for the bears to be right?

  1. Energy transition is faster than expected. If electric vehicle adoption hits 50% by 2030 (vs 25% expected), oil demand peaks and offshore investment is curtailed permanently. Noble's rigs become stranded assets.

  2. 2025 white space extends into 2026. If contract deferrals continue, Noble's marketed utilization stays below 70%, EBITDA disappoints, and the dividend is cut. Stock returns to $17-20.

  3. Oil prices crash. If recession hits and oil falls to $40-50 sustained, offshore CapEx is slashed by 30-50%. Noble's premium fleet means nothing in a depression.

  4. Competition intensifies. If Transocean, Seadrill, or Valaris engage in price wars to fill white space, day rates collapse for everyone. The industry's discipline is only as strong as the weakest player.

  5. Pabrai is right about relative value. Transocean trades at 0.3x book value, Noble at 1.0x book. If both companies face similar industry headwinds, Transocean has more upside from multiple expansion.

The bears would be right if any two of these five conditions materialize. The probability of at least two occurring is not trivial - perhaps 30-40%.

Simplest Thesis

The investment case in one elegant sentence:

Noble is a well-managed offshore driller with a premium fleet, trading at fair value with an 8% yield, but with no margin of safety, no moat, and a superinvestor exit signal that demands patience.

Why This Opportunity Exists

The deeper truth about why this mispricing might persist or correct:

Noble appears cheap on traditional metrics (7x EV/EBITDA, 8% yield, 1.0x book) because the market correctly recognizes that:

  1. Offshore drilling is inherently a cyclical, capital-intensive business with no durable competitive advantage. Premium fleets are temporary advantages that depreciate over time.

  2. The 8% yield is a warning, not an invitation. High yields exist because the market expects either dividend cuts or capital destruction. Noble's 61% payout ratio is sustainable only if EBITDA holds.

  3. Energy transition creates a terminal value problem. Even if Noble earns $2-3/share annually for the next decade, what is the rig fleet worth in 2035? The market is (rationally) applying a lower terminal multiple.

  4. Pabrai's exit removed the "smart money" validation. When a prominent value investor who initiated a 17% position reduces by 86% within two quarters, it signals that the thesis has changed or the opportunity has passed.

The opportunity exists because:

  • ESG exclusion creates forced selling
  • Energy sector is broadly out of favor
  • Complexity of merger integrations creates uncertainty
  • Commodity cyclicality creates volatility that looks like opportunity

But the deeper truth is: This is a commodity cyclical with below-cost-of-capital returns, no moat, and near-term headwinds. The "cheapness" is appropriate compensation for risk, not a mispricing.

What Would Change My Mind

The specific evidence that would invalidate this thesis:

To become bullish (consider buying):

  1. Price drops to $22-25 (-20-30% from current), providing genuine margin of safety for a cyclical
  2. EBITDA stabilizes at $900M+ through 2025, proving white space concerns overdone
  3. Oil prices recover above $90 with sustained OPEC discipline
  4. Pabrai reverses course and rebuilds position (would indicate near-term catalyst)
  5. Major contract win for idle 6G rigs at premium day rates

To become bearish (avoid entirely):

  1. Dividend cut - would signal EBITDA distress and remove yield support
  2. Oil prices crash below $60 sustained for 6+ months
  3. Customer contract cancellations (especially Guyana)
  4. Net Debt/EBITDA exceeds 2.5x - leverage becomes dangerous
  5. CEO departure - would indicate integration problems

The Soul of This Business

What makes Noble Corporation's competitive position inevitable or fragile?

Inevitable (Why it survives):

  • The world needs deepwater oil. Offshore provides ~30% of global production and that won't go to zero for decades.
  • Premium 7th-gen drillships are genuinely scarce. Only 6-8 viable cold-stacked units remain. Reactivation takes $100-300M and 1+ year.
  • Industry has consolidated. Noble, Transocean, and Valaris control most premium capacity. Rational pricing is possible.
  • Management has navigated bankruptcy, two mergers, and cyclical stress. They know how to survive.

Fragile (Why it might fail):

  • No pricing power. Day rates are set by supply/demand, not by Noble's brand or switching costs. A single aggressive competitor can destroy industry pricing.
  • Capital intensity destroys returns. Rigs cost $600M+ to build, $100M+ to maintain. Returns on invested capital barely exceed cost of capital.
  • Terminal value uncertainty. If oil demand peaks in 2030-2035, what are the rigs worth? The business might be worth more liquidated than as a going concern.
  • Customer concentration. ExxonMobil Guyana = 4 rigs = 20%+ revenue. One customer decision can impact the entire company.

The Soul:

Noble Corporation is a well-operated, capital-intensive, commodity cyclical in a structurally challenged industry. It is not a Buffett business (no moat, no pricing power, below-15% ROE). It is a Graham/Klarman deep value play that requires a significant margin of safety to compensate for its fragility.

At $31, there is no margin of safety. At $22-25, it becomes interesting. At $17-20 (where it traded in April 2025), it would be a genuine opportunity.

The patient investor's path: Set a price alert for $25. If it hits, begin accumulating a small position (1-2%). If it falls to $22, add more. Never exceed 3% due to cyclicality and lack of moat. Collect the dividend while waiting for the next upcycle. Sell at $40+ when exuberance returns.

"The stock market is a device for transferring money from the impatient to the patient." - Warren Buffett

Noble Corporation rewards patient, disciplined investors who buy at deep discounts and sell when fair value is reached. At current prices, we are being asked to pay fair value for cyclical risk with no margin of safety.

Pass - for now.

Executive Summary

Investment Thesis (3 Sentences)

Noble Corporation is the world's second-largest offshore drilling contractor (after Transocean), operating a premium fleet of 41 rigs focused on deepwater and harsh environment drilling. Following the successful integrations of Maersk Drilling (2022) and Diamond Offshore (2024), Noble has consolidated industry-leading capabilities with $6.2B in backlog and a shareholder-friendly capital return program that has returned $800M+ since the merger. At current prices of ~$31, the stock trades at 5-6x EBITDA with an 8%+ dividend yield, but the highly cyclical nature of offshore drilling, white space concerns for 2025, and Pabrai's 86% position reduction signal caution despite apparent value metrics.

Key Metrics Dashboard

Metric Value Assessment
Price $31.07 Near 52-week midpoint
Market Cap $4.85B Mid-cap driller
EV $6.85B Including $2B debt
P/E (TTM) 10.8x Appears cheap
EV/EBITDA 6.7x Cyclical discount
Dividend Yield 8.21% Very high
Payout Ratio 61% Sustainable if EBITDA holds
Backlog $6.2B ~2 years visibility
Net Debt/EBITDA ~1.8x Manageable
Fleet Size 41 rigs #2 globally

Verdict

WAIT - High cyclical risk, superinvestor exit signals caution

The apparent cheapness masks significant cyclical and execution risks. Pabrai's 86% position reduction from Q1 to Q3 2025 is a major red flag - he shifted to competitor Transocean at lower prices, suggesting Noble may have less upside remaining. Wait for clearer visibility on 2025/2026 contracting cycle and EBITDA stabilization.

PHASE 0: Opportunity Identification (Klarman)

Why Does This Opportunity Exist?

  1. Cyclical Industry Depression (2014-2021): Offshore drilling went through a brutal cycle - Noble itself went through Chapter 11 bankruptcy in 2020. The industry shed capacity, improved balance sheets, and consolidated.

  2. Fear of "White Space" (2025): Near-term utilization concerns as contracts roll off before new ones begin. First half 2025 expected to be weak before recovery in 2H 2025.

  3. Energy Transition Stigma: ESG-focused investors avoid oil services companies, creating structural underweight in institutional portfolios.

  4. Pabrai Reduction Creates Overhang: The 86% reduction from a prominent value investor may cause others to exit.

  5. Complexity from Acquisitions: Three companies (Noble + Maersk + Diamond) integrated in 2 years creates integration noise.

Source of Mispricing

The market appears to be pricing in a worse-than-expected 2025 utilization scenario while underweighting:

  • The quality of the premium fleet (15 of 17 tier-1 drillships)
  • $6.2B backlog providing visibility
  • Capital return discipline ($800M+ returned since 2022)
  • Industry consolidation benefits

However: Pabrai's dramatic exit suggests he sees better opportunities elsewhere (Transocean at deeper discount) or believes near-term EBITDA will disappoint more than expected.

PHASE 1: Risk Analysis (Inversion Thinking)

"How Could This Investment Lose 50%+ Permanently?"

  1. Prolonged Downcycle: If oil prices crash to $40-50/barrel sustained, offshore CapEx would be deferred dramatically. Noble's EBITDA could fall 50%+ from current levels.

  2. Contract Cancellations: Major customer (ExxonMobil Guyana = 4 drillships) faces production issues or policy changes, leading to early terminations.

  3. Debt Becomes Burdensome: If EBITDA falls significantly while $2B debt remains, leverage spikes and refinancing becomes expensive.

  4. Energy Transition Acceleration: If electric vehicles and renewables accelerate faster than expected, long-term offshore demand structurally declines.

  5. Operational Accidents: Major blowout or safety incident (like Deepwater Horizon for BP/Transocean) could destroy value.

Bear Case (3-Sentence Short Thesis)

Noble's 8% yield and 7x EV/EBITDA are a value trap disguised as a dividend play. The 2025 "white space" problem is real - marketed fleet utilization fell from 78% to 65% and EBITDA declined quarter-over-quarter through 2025. With Pabrai exiting 86% of his position into Transocean (trading cheaper at 0.3x book vs Noble's 1.0x book), there's likely more downside to come.

Top 10 Risks Register

Risk P(Event) Impact Expected Loss Mitigation
1. Oil price crash (<$50) 15% -60% -9.0% Hedged backlog provides runway
2. 2025 utilization worse than expected 40% -30% -12.0% Backlog converts to revenue
3. Dividend cut 25% -25% -6.3% 61% payout sustainable at current EBITDA
4. Integration issues (Diamond) 15% -20% -3.0% Track record from Maersk integration
5. Major safety incident 5% -50% -2.5% Insurance, safety culture
6. Guyana political/operational risk 10% -25% -2.5% ExxonMobil relationship strength
7. Contract repricing lower 30% -15% -4.5% Tier-1 drillships command premium
8. Energy transition acceleration 10% -40% -4.0% Diversified fleet, cash returns
9. Competitor aggressive pricing 20% -15% -3.0% Industry consolidated
10. Management capital allocation error 10% -20% -2.0% Track record solid
Total Expected Downside -48.8%

Sell Triggers (Pre-Defined)

  1. Thesis Break: Dividend cut or suspension
  2. Moat Erosion: Loss of ExxonMobil Guyana contract
  3. Management Failure: Leverage exceeds 3.0x Net Debt/EBITDA
  4. Valuation: Price exceeds $55 (50% above fair value estimate)

PHASE 2: Financial Analysis

Income Statement Summary (2022-2024)

Metric 2022* 2023 2024 2024 vs 2023
Revenue $1.65B $2.59B $3.06B +18%
Gross Profit - $744M $837M +12%
Operating Income $281M $575M $604M +5%
EBITDA $450M $769M $1,015M +32%
Net Income $197M $482M $448M -7%
EPS ~$1.50 $3.32 $2.96 -11%

*2022 partial year post-Maersk merger

Balance Sheet Strength (Dec 2024)

Metric Value Assessment
Total Assets $7.96B Mostly PP&E
Cash $247M Low vs debt
Total Debt $2.08B Elevated post-Diamond
Net Debt $1.84B 1.8x EBITDA
Shareholders' Equity $4.65B Strong
Book Value/Share $30.68 ~1.0x P/B
Current Ratio 1.48x Adequate

Cash Flow Analysis (2024)

Metric Value
Operating Cash Flow $655M
CapEx $575M
Free Cash Flow $80M
Dividends Paid $278M
Share Repurchases $366M
Total Capital Returns $644M

Note: Capital returns exceed FCF due to Diamond acquisition cash. Sustainable dividend requires FCF > dividends, which is tight.

Return Metrics

Metric 2024 Assessment
ROE 9.6% FAILS Buffett 15% test
ROIC ~8% Barely above WACC
Gross Margin 27% Asset-heavy business
EBITDA Margin 33% Reasonable
Net Margin 14.7% Good

Valuation Trinity (Klarman Framework)

1. Liquidation Value (Floor)

Net Current Assets: $1.39B - $0.94B = $449M
PPE (at 30% haircut): $6.15B × 0.30 = $1.85B
Intangibles: $0 (written off in liquidation)
Total Liabilities: $3.31B
--------------------------------------------
Liquidation Value: ~$0/share (negative if assets sell below carrying value)

Assessment: No downside protection from asset values. Rig values are highly volatile and could be worth far less in distress.

2. DCF - Owner Earnings Valuation

Base Case Assumptions:

  • Normalized EBITDA: $900M (below 2024's $1B due to cycle)
  • Maintenance CapEx: $350M (peak cycle now behind)
  • Interest: $100M
  • Taxes: $50M
  • Owner Earnings: $900M - $350M - $100M - $50M = $400M
Owner Earnings Per Share: $400M / 152M shares = $2.63
Conservative Multiple (10x): $26.30
Fair Value Multiple (12x): $31.56
Optimistic Multiple (15x): $39.45

DCF Sensitivity:

EBITDA Scenario Owner Earnings 10x 12x 15x
Bear ($750M) $2.00/share $20 $24 $30
Base ($900M) $2.63/share $26 $32 $39
Bull ($1.1B) $3.50/share $35 $42 $53

3. Private Market Value

Recent M&A comps:

  • Noble acquired Diamond Offshore at ~6.5x EBITDA (Sep 2024)
  • Industry consolidation premiums range 15-25%

At 7x EV/EBITDA ($1.0B):

  • EV = $7.0B
  • Less Net Debt: $1.84B
  • Equity Value: $5.16B
  • Per Share: $34

Valuation Summary

Method Value/Share vs $31 Price MOS
Liquidation $0-10 N/A N/A
DCF (10x) $26 -16% Negative
DCF (12x) $32 +3% 0%
DCF (15x) $39 +26% 21%
Private Market $34 +10% 9%
EV/EBITDA 6x $27 -13% Negative
Weighted Average $31 0% 0%

Conclusion: At $31, Noble is trading at approximately fair value with no meaningful margin of safety. This is NOT a Graham/Buffett buy.

PHASE 3: Moat Analysis

Moat Sources

Moat Type Strength Evidence
Scale MODERATE #2 fleet globally (41 rigs), enables customer diversification
Switching Costs WEAK Customers can switch drillers at contract end
Asset Quality MODERATE 15 of 17 7th-gen drillships, MPD capabilities
Customer Relationships MODERATE Long-term ExxonMobil Guyana relationship
Pricing Power WEAK Commodity-like day rates, cyclical

Moat Rating: NARROW to NONE

Offshore drilling is fundamentally a commodity business. Day rates are set by supply/demand dynamics, not brand or switching costs. Noble's advantages are:

  1. Premium fleet quality (7th-gen drillships)
  2. Geographic diversification
  3. Operational excellence track record
  4. Relationships with majors (ExxonMobil, Shell, Petrobras)

But these do NOT constitute a Buffett moat. Any well-capitalized competitor with good rigs can take market share.

Moat Durability Assessment

Threat Severity Timeline Company Mitigation
Oil price decline 5/5 Immediate Backlog, but limited
New entrant 2/5 3-5 years High CapEx barrier
Technology disruption 2/5 10+ years Subsea/autonomous far out
Customer concentration 3/5 1-3 years ExxonMobil 20%+ revenue
Regulatory (emissions) 3/5 5-10 years Fleet modernization

Will this moat be wider or narrower in 10 years? → NARROWER - Energy transition headwinds, potential for reduced offshore investment

PHASE 4: Management & Decision Synthesis

Management Assessment

Factor Assessment
CEO Robert Eifler (since 2022 merger)
Track Record Successfully integrated Maersk Drilling and Diamond Offshore
Skin in Game Executives hold stock, but compensation is significant
Capital Allocation Strong - $800M+ returned to shareholders since merger
Communication Transparent about challenges and opportunities

Compensation Alignment: Management bonuses tied to EBITDA, safety, and TSR - reasonably aligned but short-term focused.

Capital Allocation Track Record

Use of Cash (Since 2022) Amount Quality
Dividends $400M+ Good - sustainable so far
Buybacks $400M+ Mixed - bought at $40+ average
Diamond Acquisition $1.6B TBD - integration ongoing
Debt Paydown Limited Negative - leverage increased

Superinvestor Activity Analysis

Mohnish Pabrai:

  • Q1 2025: Initiated ~17% position, 1.73M shares @ ~$28
  • Q3 2025: Reduced 86% to 2% position, sold ~1.49M shares
  • Simultaneously added Transocean (RIG) as replacement

Interpretation: Pabrai's dramatic exit is a significant red flag. He likely believes:

  1. Near-term EBITDA will disappoint
  2. Transocean offers better value at deeper discount
  3. Noble's rally exhausted near-term upside

This is NOT a validation of Noble - it's a warning signal.

Position Sizing Calculation

Base Allocation: 3% (cyclical, no wide moat)
Margin of Safety: 0% → Multiplier 0.5x
Quality Score: 60/100 (ROE fails, narrow moat)
Risk Score: 0.49 (48.8% expected downside)
Catalyst Multiplier: 0.7 (no clear catalyst)

Position Size = 3% × 0.5 × 0.60 × 0.51 × 0.7 = 0.32%

Recommended Position: 0% - WAIT for better entry

Expected Return Scenario Analysis

Scenario Probability 3-Year Return Weighted
Bull (EBITDA $1.2B, 8x) 20% +70% +14%
Base (EBITDA $950M, 7x) 45% +15% +7%
Bear (EBITDA $750M, 6x) 30% -25% -8%
Disaster (Dividend cut) 5% -50% -3%
Expected Return 100% +10%

A +10% expected return over 3 years (3.3% annualized) with 35% downside risk is not compelling.

FINAL RECOMMENDATION

┌─────────────────────────────────────────────────────────────────┐
│                     INVESTMENT RECOMMENDATION                    │
├─────────────────────────────────────────────────────────────────┤
│ Company: Noble Corporation           Ticker: NE                 │
│ Current Price: $31.07                Date: Feb 1, 2026          │
├─────────────────────────────────────────────────────────────────┤
│ VALUATION SUMMARY                                                │
│ ┌─────────────────────────┬─────────────┬─────────────────────┐ │
│ │ Method                  │ Value/Share │ vs Current Price    │ │
│ ├─────────────────────────┼─────────────┼─────────────────────┤ │
│ │ Graham Number           │ N/A         │ N/A (cyclical)      │ │
│ │ Liquidation Value       │ $0-10       │ Negative MOS        │ │
│ │ DCF (Conservative)      │ $26         │ -16% MOS            │ │
│ │ DCF (Fair Value)        │ $32         │ +3%                 │ │
│ │ Private Market Value    │ $34         │ +10%                │ │
│ │ EV/EBITDA 7x           │ $31         │ 0%                  │ │
│ └─────────────────────────┴─────────────┴─────────────────────┘ │
│                                                                  │
│ INTRINSIC VALUE ESTIMATE: $31 (at current EBITDA)               │
│ MARGIN OF SAFETY: 0%                                             │
├─────────────────────────────────────────────────────────────────┤
│ RECOMMENDATION:  [ ] BUY  [ ] HOLD  [ ] SELL  [X] WAIT          │
├─────────────────────────────────────────────────────────────────┤
│ STRONG BUY PRICE:         $22 (-30% from fair value)            │
│ ACCUMULATE PRICE:         $25 (-20% from fair value)            │
│ FAIR VALUE:               $31                                    │
│ TAKE PROFITS PRICE:       $37 (+20% above fair value)           │
│ SELL PRICE:               $47 (+50% above fair value)           │
├─────────────────────────────────────────────────────────────────┤
│ POSITION SIZE: 0% (WAIT for pullback)                           │
│ CATALYST: 2H 2025 contracting improvement (Timeline: 6-12 mo)   │
│ PRIMARY RISK: Prolonged utilization downturn                    │
│ SELL TRIGGER: Dividend cut or Net Debt/EBITDA > 3.0x           │
└─────────────────────────────────────────────────────────────────┘

Appendix: Source Documents

Primary Data Sources

  1. AlphaVantage MCP: Income Statement, Balance Sheet, Cash Flow (2022-2024)
  2. AlphaVantage MCP: Earnings Call Transcripts (Q4 2023 - Q3 2024)
  3. EODHD: Market data, fundamentals (API issues encountered)
  4. WebSearch: Historical prices, dividend history, Pabrai portfolio tracking

Files Saved

  • /research/analyses/NE/data/income-statement.json
  • /research/analyses/NE/data/balance-sheet.json
  • /research/analyses/NE/data/cash-flow.json
  • /research/analyses/NE/data/historical-prices.json
  • /research/analyses/NE/data/dividend-history.json
  • /research/analyses/NE/data/earnings-transcript-Q3-2024.md
  • /research/analyses/NE/data/SOURCE_CHECKLIST.md

Key Data Cross-References

  • 2024 Revenue $3.06B: Earnings call transcript + income statement
  • 2024 EBITDA $1.015B: Earnings call guidance achieved
  • Backlog $6.2B: Q3 2024 earnings call
  • Dividend $2.00/year: Dividend history tracking
  • Pabrai 86% reduction: 13F filings via Gurufocus/StockCircle