5-Star Stocks Poised to Pop: OYO Geospace

• Email
• Share
• Print

Based on the aggregated intelligence of 140,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, seismic data equipment maker OYO Geospace (Nasdaq: OYOG) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at OYO's business and see what CAPS investors are saying about the stock right now.

OYO Geospace facts

Headquarters (Founded)	Houston (1980)
Market Cap	$152.1 million
Industry	Oil and gas equipment and services
Trailing-12-Month Revenue	$100.6 million
Management	Chairman/CEO Gary Owens (since 1997) CFO Thomas McEntire (since 1997)
Return on Equity (Average, Past 3 Years)	14.3%
Cash / Debt	$1.6 million / $9.7 million
Other Highly Rated Oil and Gas Service Stocks	Schlumberger (NYSE: SLB) Halliburton (NYSE: HAL) National Oilwell Varco (NYSE: NOV)
CAPS Members Bullish on OYO Also Bullish on	Dawson Geophysical (Nasdaq: DWSN) Portfolio Recovery Associates (Nasdaq: PRAA)
CAPS Members Bearish on OYO Also Bearish on	China Mobile (NYSE: CHL)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 98% of the 1,355 members who have rated OYO believe the stock will outperform the S&P 500 going forward. These bulls include TMFmrquakeroats and All-Star investorpoet2, who is ranked in the top 15% of our community.

Just last month, TMFmrquakeroats tapped OYO as a great bet to yo-yo back: "The Energy sector is down but not out. [OYO] is one of the top-rated stocks related to seismic data."

In a pitch from three days later, investorpoet2 elaborates on the seismic opportunity. Here's an excerpt:

The company notes that their backlog has increased substantially in recent weeks, with the majority of the orders to be delivered during the fourth quarter of 2009. …

Oil prices have risen recently to over $70 per barrel. This appears to be a threshold point for many of Oyo's customers. If Oyo's backlog of orders has increased and new sales continue to flow in, improved earnings will be coming soon. … Their new [Geospace Seismic Recorder] systems were gaining traction even in the downturn. Higher oil prices could dramatically boost sales of this new product.

Oyo has the capacity to handle improved demand without additional investment. If earnings improve to 2008 levels and optimism about their new products returns, the stock could return to $50 levels.

What do you think about OYO Geospace, 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!