These are the boom times in the energy cycle.

Exploration and production budgets continue to swell. Drilling and services companies are as busy as they have been in many years. And yet, although other large service companies like Schlumberger (NYSE:SLB) and Halliburton (NYSE:HAL) had solid quarters, No. 3 player Baker Hughes (NYSE:BHI) seemed to have a somewhat rougher go of it.

It's not that results were bad. I'd hardly say that 17% revenue growth, 52% operating income growth, and 61% net income growth is "bad" -- particularly in a quarter when there were two large, disruptive storms. Still, those results missed the published average estimate, and Baker Hughes' growth rates compared with the previous quarter weren't particularly strong. Interestingly, the published estimates in front of me show no changes over the past couple of months. I think that's a bit odd because most people knew that Katrina would have an impact.

Making matters potentially a bit more confusing, while the company confirmed that pricing in the energy services space is accelerating and capacity remains tight, guidance for the next quarter was a bit below the current averages. What's more, admitting it needed more research and development spending and more capex investment might unnerve some investors, even though it's part and parcel of the business.

Even though Baker Hughes isn't the biggest kid on the block, and it operates in an intensely cyclical business, I think you can argue that it's nevertheless an above-average company. It has consistently paid a dividend for more than 10 years, even though those weren't all good years for energy service companies. What's more, my calculations show a long-term average return on invested capital well above industry norms.

Unfortunately, I cannot coerce my cash flow model into producing a price that suggests this stock is a great buy today. Still, earnings leverage should be positive for the next couple of years, and if traders continue to bid up energy stocks across the board, this one will likely go along for the ride. So while this might be an interesting play for investors looking for some short-term action in the energy sector, the cash flow picture suggests a lingering engagement might be more difficult.

For more energetic Takes:

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