5-Star Stocks Poised to Pop: Allis-Chalmers
By
Brian D. Pacampara
November 11, 2009
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Based on the aggregated intelligence of 140,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, oilfield-services specialist Allis-Chalmers Energy (NYSE: ALY) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Allis-Chalmers' business and see what CAPS investors are saying about the stock right now.
Allis-Chalmers facts
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Headquarters (Founded)
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Houston (1913)
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Market Cap
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$252 million
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Industry
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Energy equipment and services
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Trailing-12-Month Revenue
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$559 million
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Management
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CEO Munawar Hidayatallah (since 2001)
CFO Victor Perez (since 2004)
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Return on Capital (Average, Past 3 Years)
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6.1%
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Cash/Debt
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$41.6 million / $495.4 million
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Competitors
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Baker Hughes (NYSE: BHI)
Halliburton (NYSE: HAL)
Schlumberger (NYSE: SLB)
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CAPS Members Bullish on ALY Also Bullish on
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Chesapeake Energy (NYSE: CHK)
Vale (NYSE: VALE)
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CAPS Members Bearish on ALY Also Bearish on
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Legg Mason (NYSE: LM)
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97.6% of the 791 members who have rated Allis-Chalmers believe the stock will outperform the S&P 500 going forward. These bulls include 1Landmark and All-Star fmahnke, who is ranked in the top 3% of our community.
Late last month, 1Landmark tapped Allis-Chalmers as a slick way to defend against the gangrenous greenback: "This stock has room for growth. Energy provides a good hedge against a weak U.S. dollar."
In a pitch from last week, fmahnke also pushed Fools to capitalize on the company's recent struggles:
Another rough quarter creates what I consider to be a buying opportunity, As long as [Allis-Chalmers] can continue to meet its debt obligations, I can wait for the return to profitability, Tangible book is near $6 [per share] and that understates the [fair market value] of their drilling rigs. ... The Company's redeployment of assets to South America should help make it profitable soon, which will hopefully return the stock to the $12-18 prices it traded for last year....
What do you think about Allis-Chalmers, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. The CAPS community is waiting to hear your opinions. CAPS is 100% free, so get started!
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