02/22/10 Stockholm, Sweden – Based on its new quarterly report, Houston-based onshore, rig-based well servicing contractor Key Energy Services (NYSE:KEG) is showing renewed signs of sales growth.
Agora Financial expert editor Chris Mayer dug deeply into the numbers and had the following opinion:
I mentioned that sales figures confirm that overseas markets are where the growth is for oil field services. Key Energy Services (NYSE:KEG) is Exhibit A. The stock just reported earnings last week and is not far off its 52-week high. While Key expects sales growth of 15-20% this year in the U.S., it expects 50-60% growth overseas — in particular from Russia, Argentina and Mexico.
The other key takeaway here is that the recovery in Key’s business is under way. As CEO Richard Alario put it: “As of last week, the Baker Hughes U.S. land-based rig count was up 31% from where we began the fourth quarter. Although the oil-directed rig count is up 46% within this time frame, our larger customers have just recently become more active. In addition to an improving oil market, industrywide activity in the U.S. gas market has increased 25% since the beginning of the fourth quarter.”
This quarterly report gave us more indication that things are moving in the right direction here. The stock is still cheap based on potential cash flow and earnings in the next up cycle.
Mayer provides regular research and updates on companies like Key Energy Services in his newsletter, Mayer’s Special Situations. More details are available at the Agora Financial reports page. In July, Mayer will also be speaking at the Agora Financial Investment Symposium in Vancouver. You can find details about the event here.
Rocky Vega
Rocky Vega is publisher of The Daily Reckoning. Previously, he was founding publisher of UrbanTurf and RFID Update, which he operated from Brazil, Chile, and Puerto Rico, and associate publisher of FierceFinance. He specialized in direct marketing at MBI, facilitated MIT Sloan School of Management programs, and has been featured on CBS. Vega graduated with honors from Harvard University, where he was on the board of Let’s Go Publications and directed business programs involving McKinsey, Goldman Sachs, and Harvard Business School faculty. He is also enrolled at the Stockholm School of Economics.
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Geeze, when did the Daily Reckoning become a cheesy “pump-and-dump” operation?
DailyReckoning using pop-up ads. Either the crisis is finished or we are on our way to another leg down. You decide.
@Chucky Cheese
Thank you for posting your concern. We do not take accusations of “pump and dump” lightly. For the record, Agora Financial editors are expressly forbidden from owning securities that they research and write about for their newsletters.
Furthermore, Agora Financial does not receive any type of compensation for or from companies covered. This is also true for The Daily Reckoning and our parent company, Agora Inc . Our only goal is to provide readers with unbiased and completely independent information.
Hyping penny stocks like NNVC certainly exposes Agora to “pump and dump” suspicions. Putting on a layer of professionalism on the front page, while talking about gorillas and blowguns (!) to push penny drug stocks on subscribers is scary.