Cracking open shale formations to release natural gas stands to make the U.S. a world leader in energy production once again. Which company's stock best lets you participate in this new energy boom, though? There's a good case to be made for Carbo Ceramics (CRR)

By now, most Americans are familiar with the energy independence story. New extraction technologies have opened abundant shale formations to exploration and development. Today we rely less on energy that is imported from afar. The trend is only expected to accelerate in the years ahead.

Natural gas prices, like other commodities, are volatile – and right now are at a low ebb. The future of gas is bright, however. The smarter play is to invest in companies like Carbo and rival Hi-Crush Partners (HCRS.Q), which as the old saying goes, sells the picks and shovels to the gold miners – a steadier business than mining. Spending on fracking infrastructure is surging, and that spending is projected to keep climbing. 

Where Carbo comes out ahead is the superiority of its signature product, which it has just refined. With fracking, operators drill a well and blast rock formations with high-pressure water to open fractures and release gas.

Carbo makes proppants – tiny spheres used to "prop up" cracked shale rock to allow oil and gas to flow more efficiently. Sand can do the job, but remember the saying that "not any two grains are identical"? Believe it or not, the uniqueness of sand is detrimental as a proppant. Roundness and consistency of shape is prized in this business. A round, durable product with high conductivity is more valuable because these properties allow oil and gas to flow easier, faster, and more completely. This maximizes production volumes. The best material to make these spheres is ceramics.

Hi-Crush specializes in sand proppant while Carbo focuses on ceramics, which cost more. While sand has most of the market, ceramics is better at keeping fissures open where the rock is harder. This is beneficial in fields such as Eagle Ford Shale in North Dakota, according to a Freedonia Group research report.

In October, Carbo debuted an advanced version of its ceramic proppant, which it calls Kryptosphere. The company says its spheres are stronger and more uniform than earlier generations of proppants.

The average increase in fracking capital spending of 7% suggests improving volumes for Carbo Ceramics, as its technologically advanced products, superior logistics, and expert sales force continue to take share from lower-quality Chinese imports. New technologies such as Kryptosphere have distanced Carbo from the competition and created a distinct advantage in the marketplace. This latest proppant sets a new standard for conductivity and durability, both of which are incredibly high-valued as features for drillers.

Carbo's sales volume increased smartly last year, despite competition from cheaper Chinese ceramics. Its net income dipped 20% because of lower prices and high capital spending, which was mainly devoted to the new product. The company expects to start up its new production line in Millen, GA by the end of the second quarter. Additional production is planned to go online about a year later at the same site. The combination will add 500 million pounds in ceramic capacity per year, a 29% capacity expansion. This will put the company in a strong position to benefit from the acceleration in North American well completion activity.

Sales are growing at a healthy 15% rate, and Carbo's gross margin is a fat 36% that eclipses the industry's. While the company's dividend yield is just 1%, it has increased payouts for 11 years in a row. It carries no debt.

This company is a growth stock story. The company's stock price rose about 80% over the past 12 months. At about 35 times trailing earnings, shares aren't cheap, but still trade below 2011 highs. At about 23 times 2015 estimated earnings per share of $5.67, shares look more interesting. The company has no debt and its operating cash flow is healthy and growing.

If you're looking to get in on American energy production, this may well be the place to start.