RPC Shares Popped Temporarily: What You Need to Know (RES)

RPC Shares Popped Temporarily: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of oil-field service and equipment provider RPC (NYSE: RES ) jumped as much as 11% in early trading today only to see shares trade flat by midday.

So what: There were rumors swirling that Patterson-UTI (Nasdaq: PTEN ) was going to buy RPC, but the market dismissed them as the trading day went on. Analyst Neal Dingmann at Suntrust Robinson Humphrey was quoted as saying he'd heard rumors that Patterson, Superior Energy (NYSE: SPN ) , and others would buy RPC.

Now what: This rumor has already been put to rest for today, but this may be a good time to reevaluate RPC's shares. The company's unconventional oil drilling business is its current driver and may be attractive to potential buyers or long-term investors right now. Unconventional oil plays are hot in the U.S., and RPC's shares are trading at just 7 times forward earnings, a great price in this market.

I have enough confidence to give the company a green thumb on My CAPS board in a bet the company will outperform the market.

Interested in more info on RPC? Add it to your watchlist by clicking here.

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Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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Report this Comment On October 13, 2011, at 1:52 PM, GCF007 wrote:

I can agree with your comments as an active shareholder in this company and it does have a wide footprint of loyal customers. They did hire Goldman Sachs, publicly acknowledged, to explore strategic options and alternatives in early August 2011; and I would not be surprised to see a sale play out.
Report this Comment On October 14, 2011, at 11:01 PM, TruffelPig wrote:

I am also holding shares of RES and agree with the previous post. RES and others in this business are very very volatile stocks and one needs good nerves. BTW, the stocks went up 7% after being at 0% like article said. So they popped-dropped-and-popped that day. What is important is that RES is a very solid and profitable company so one can hold those shares easily. Also pays a small dividend. If RES gets sold this year it will be in the $35 or so range.

updated 20 hours ago Sponsored by:
	DOW	12,454.83	-74.92	-0.60%
	S&P 500	1,317.82	-2.86	-0.22%
	NASD	2,837.53	-1.85	-0.07%

RES	$10.68		-0.10	-0.93%
RPC, Inc.		CAPS Rating:

SPN	$21.48		-0.23	-1.06%
Superior Energy Se…		CAPS Rating:

PTEN	$15.75		+0.17	+1.09%
Patterson-UTI Ener…		CAPS Rating:

3

RPC Shares Popped Temporarily: What You Need to Know

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Comments from our Foolish Readers

Report this Comment On October 13, 2011, at 1:52 PM, GCF007 wrote:

Report this Comment On October 14, 2011, at 11:01 PM, TruffelPig wrote:

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