Barclays has moved Noble Corporation (NYSE: NE) down one notch in its coverage scale, shifting its recommendation to Equalweight from Overweight while increasing its price target to $41 from $36. The firm cites valuation considerations as the central reason for the change, even as it models stronger cash flow and EBITDA outcomes in the medium term.
At the time of the note the stock was trading at $43.47, close to its 52-week high of $46.31. The company’s trailing price-to-earnings ratio stands at 32.29, which Barclays identifies as indicating a premium multiple versus its assessment of intrinsic value.
Analyst Ed Klim raised Barclays’ 2026 EBITDA estimate to $1,001 million from $945 million and lifted the 2027 projection to $1,160 million from $1,091 million. The new price target is derived from a rig-by-rig discounted cash flow analysis that uses a discount rate of 10.5% - a rate Barclays maintained from its prior work.
Barclays’ updated valuation rests on specific day-rate assumptions for leading-edge floater rigs operating in the U.S. Gulf of Mexico. The model now assumes a day rate of $410,000 per day by the second quarter of 2026, a level that Barclays expects to persist for one year before increasing to $460,000 per day by the fourth quarter of 2027 and then continuing into perpetuity. That contrasts with the previous assumption of $430,000 per day by the fourth quarter of 2027.
Summing the present value of free cash flow from each individual rig, Barclays arrives at an enterprise value estimate of $6.5 billion, up from its prior $5.8 billion figure. For context, Noble’s last-twelve-month EBITDA is reported at $1,056.52 million and the company’s current EV/EBITDA multiple is 8.12, figures Barclays uses to frame its view of relative valuation.
Noble Corporation is an operator of offshore drilling rigs serving the oil and gas sector. The company’s most recent quarterly report, covering the fourth quarter of 2025, showed mixed results. Earnings per share came in at $0.09, below the analyst consensus of $0.16, representing a 43.75% negative surprise. Revenue, however, exceeded expectations at $764.41 million versus the anticipated $729.89 million, a 4.73% positive surprise.
Barclays’ action combines upward revisions to modeled cash flows and rig economics with a downgrade in recommended positioning because the market price and traditional multiples appear to reflect a premium. Investors and market participants will weigh the firm’s updated EBITDA and day-rate assumptions alongside the recent quarter’s mixed operating results as they assess Noble’s outlook.
What this means
- Barclays increased forward EBITDA forecasts for 2026 and 2027 while raising its enterprise valuation.
- The firm reduced its rating on Noble to Equalweight, signaling caution given current market multiples despite higher modeled cash flows.
- Noble’s latest quarter showed a revenue beat but an EPS miss, a contrast that highlights operational and financial variability investors must consider.