Investors in ambulance operator Rural/Metro (NASDAQ:RURL) have had a heck of a ride.

The stock was popular in the early- to mid-'90s, as investors bought into the story of the benefits of a consolidating industry and the company posted good earnings growth. Since peaking near $40 a share in 1996, though, the stock plummeted to less than $1 a share, as the company's acquisitions and debt load came back to haunt investors in a big way.

Despite having negative shareholder equity since 2001, the company has managed to stay cash flow positive and stave off bankruptcy. In fact, operating cash flow has nearly quintupled in that time, and free cash flow has been positive (and growing) for four straight years. Likewise, the stock has moved from a low of less than $2 in mid-'04 to more than $10 of late -- a major win for those daring investors who saw hope amidst the carnage.

Turning, then, to fourth-quarter results, it appears as though a slow recovery is still under way. Revenue was up 10% for the period, and EBITDA climbed 8%, while operating income rose about 34% on improving margins. Because of a very large income tax benefit, net income for the quarter isn't particularly illustrative, though the company did reverse a year-ago loss on a pre-tax-earnings basis.

When you're talking about a company in this condition, understanding the balance sheet and cash flow statement is even more important than normal. The balance sheet is still pretty scary -- what with more than $300 million in debt versus only about $164 million in current assets and property/equipment -- but accounts receivable management appears to still be under control. Turning to cash flow, operating cash flow was up almost 72% over last year, and the company was free cash flow positive.

Ambulance services remains a tough space. Margins are thin, and Canadian conglomerate Onex has been building a sizable business by buying up other transportation and emergency service operators. What's more, although the company has done a good job of improving its cash flow, long-term debt hasn't appreciably changed in about four years.

For those who've already made a bundle on this potential turnaround, I certainly salute your courage and your success thus far. That said, it is all but impossible for me to say that this stock is suitable for anyone other than the most risk-tolerant investors looking for speculative turnaround candidates.

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).