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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: upanddown who wrote (22231)	5/18/1998 9:35:00 AM
From: jbe	Respond to of 95453

Thanks, John, for your comments on RES. And Douglas, yes, RES is an "overlooked company." In my view, it shouldn't be. I will indeed be watching it, and some of the rest of you might want to keep an eye peeled, too. It is puzzling why a company of its size (over 400 mill. cap), of its age as a public company (at least 10 years), and of its (good)long- and short-term price performance, should be overlooked, why no analysts follow it. Could it be because it isn't really "a company," but a "collection of companies"?? (I just turned up yet one more RES subsidiary: EcoWaste Technologies. Develops hazardous waste technologies.) As I pointed out in my original query, what is striking about RES is not its EPS/sales/cash flow growth per se (good, not outstanding), but the steadiness of that growth (this is what investors really appreciate). RES scores in the 99th percentile (of ALL companies) for 5-year EPS consistency, and in the 97th for 10-year EPS consistency. My conclusion was that this was unique in the oil service sector, with its notorious up-and-down oil prices, etc. This morning I checked out my assumptions by running an industry search for 5-year EPS consistency. RES did indeed come out in first place (of 25); only SII and TDW were even close. Since, in my experience, companies that are great in one respect sometimes turn out to be lousy in other respects (beware of extremes!), I threw in two other criteria -- highest possible ROA and highest possible ROE. (These three criteria in combination -- EPS consistency, ROA, and ROE -- tend to turn up really solid companies.) Well, RES again popped up, in 6th place (following TDW, SII, RDC, ESV, and NE). Then I threw in a fourth criterion -- lowest possible debt/equity (I'm conservative in these matters). RES moved back into second place, just behind SDC. Then I threw out the EPS 5-year consistency criterion altogether (an awful lot of companies in this industry haven't been around for 5 years, at least not as public companies), and RES still made it onto the list (11th place). Sounds good to me! By the way, all you WEL fans out there, WEL does not appear to have a unique niche in the industry. For example, according to the RES website, Cudd Pressure Control (an RES subsidiary) "was one of only four American companies invited to control burning wells in Kuwait...and the only American company invited to conduct all the post-capping work." And it can do things like that and at the same time maintain steady EPS growth -- unlike WEL! Nyah, nyah! I am beginning to sound like a paid company tout! No, I am not a shill. It's just that I find it surprising that none of you very knowledgeable people out there seems to be familiar with an outfit that claims, among other things, to be "THE" industry leader in coiled tubing. Anyhow, we shall see what we shall see! jbe P.S. John, Bobby Joe Cudd is a "good ol' boy." According to his bio on the website, he "began his career in 1949 as a roughneck on drilling rigs throughout the midwest." He founded Cudd Pressure Control in 1977, and is still President of it (as well as Exec VP of RPC, whatever that is.) Incidentally, sorry about RPC/RGC typo.