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Aggressive Growth

Key Energy Services, Inc (KEG - Snapshot Report) analysts raised their estimates after the most recent quarterly report. Earnings came in above expectations thanks to a swelling top line.

Shares are now a Zacks #1 Rank (Strong Buy) and with the company increasing its capital outlay, the growth should continue.

Company Description

Key Energy Services is an onshore rig-based oil and gas well servicing company. They offer maintenance, workover and recompletion of existing wells and plugging tapped out wells. Other services included fluid and logistics, fishing, rental and drilling.

Topped Estimates

On Apr 28 Key Energy reported first quarter results that showed a 55% increase in revenue, to $391 million. The vast majority of the revenues came from the U.S. segment, which was almost 11%.

Net income from continues operations was $12.9 million, or $0.09 per share. The Zacks Consensus Estimate was calling for $0.07.

Estimates Moving Higher

Key Energy said that was able to overcome higher costs and weather related challenges as they look to the more active portion of the year. They are ramping up capital spending that should start to show later this year.

Estimates for 2011 are averaging $0.83, up 21 cents since the earnings report. Next year's Zacks Consensus Estimate is $1.39, up 46 cents. Last year the company lost 13 cents per share, so this is a pretty sharp turn around.

Bullish Outlook

Below you can see that once timid analysts have become increasingly bullish on the earnings outlook for Key Energy. Each colored line represents a particular year's consensus estimates.

Year over year growth is great to see, but now we are also seeing the estimates move higher through the year, pushing shares to a Zacks #1 Rank (Strong Buy).

Key Energy Services, Inc - ticker KEG>

Bill Wilton is the Aggressive Growth Stock Strategist for He is also the Editor in charge of the Zacks Small Cap Trader service

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