At the Core of Drilling Analysis

04/22/2014 7:00 am EST


Leo Fasciocco

Investment Columnist and Publisher, Ticker Tape Digest

Our latest featured breakout stock is a Netherlands-based company that provides geological analysis and measurement equipment for the oil industry, explains Leo Fasciocco, editor of Ticker Tape Digest.

The services provided by Core Laboratories (CLB) are used to help oil companies make decisions regarding the presence and amount of hydrocarbon accumulations.

This year, analysts are forecasting a 20% gain in net to $6.28 a share from $5.25 a year ago. The stock sells with a price-earnings ratio of 33. That is high. So, the stock is most suitable for aggressive investors.

Looking ahead to 2015, the Street projects a 17% gain in net to $7.32 a share from the anticipated $6.28 this year.

Institutional sponsorship is excellent. The largest fund holder is the 3-star rated American Funds Growth Fund of America, with a 3.9% stake. A key fund buyer recently was the 5-star rated Delaware Mid-Cap Growth-Focus fund, which purchased 348,264 shares.

CLB's long-term chart shows the stock climbing from $6 back in 2003 to a peak at $77.75 in late 2007, the top in the prior bull market. The stock then fell back to $24 in 2008 due to the bear market.

However, since then, CLB's stock has been soaring. It has since climbed above $200, a nine-fold move. The stock has just broken out from a five-week flat base.

The move carried the stock to a new all-time, which is bullish and could attract more buying, especially since energy stocks have been strong. We are targeting CLB for a move to $250 off this breakout. A protective stop can be placed near $200.

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