What: Shares of Forum Energy Technologies Inc (NYSE:FET) dropped as much as 12% today after the company reported very disappointing earnings.

So what: Revenue for the second quarter fell 34% to $284.4 million and net income dropped 78% to $8.9 million, or $0.10 per share. Revenue fell short of the $312.2 million Wall Street analysts had projected and even earnings adjusted for restructuring costs of $0.16 per share were $0.02 behind estimates.  

Now what: It's actually commendable that Forum Energy Technologies made any profit in the quarter considering the deterioration in drilling. North American land rig count dropped 51% year over year and production completions were down as well, both of which affected revenue. But the results were below expectations, and expected earnings of $0.08 to $0.13 per share in the third quarter were below analysts' target of $0.17 per share.

Buying this stock now is a risk, and growth will depend on an improvement in drilling conditions. But I think the risk/reward profile is looking stronger than the market is pricing in, and when drilling does recover, this stock will be a big winner for long-term investors.