5 Oil Services Buys Beyond the ‘Big Two’

C&J Energy Services

Trailing P/E: 5.3
2013 P/E: 6.3

Aside from the various ingredients in the fracking fluid that’s used to crack open a shale well, it also takes some very high-pressure and high-horsepower pumps. C&J Energy Services (NYSE:CJES) is as close as you can get to a pure player in sector. The company strictly provides hydraulic fracturing, coiled tubing and pressure-pumping services to E&P industry.

Between 2009 and 2011 that was a great place to be. However, as the glut of natural gas continues, rig counts across the nation continue to drop, hurting firms like C&J that provide the pressure.

However, looking longer-term, fracking will remain an integral part of North America’s energy future, and players like C&J will be there to provide those essential services.

For investors, the dip in rig counts has created an opportunity to snag a premier pure player that boasts a three-year EPS growth rate of 781% — at a discount. In addition to its other attractive multiples, CJES currently is trading at a delicious price-to-earnings growth ratio of just 0.27, meaning it’s very undervalued (fair value = 1).