Carbo Ceramics, Inc.

Carbo Ceramics, Inc. (CRR - Snapshot Report) continues to benefit from elevated energy prices. The company's second-quarter results were excellent, analyst estimates are up once again, and its stock price has been rallying for most of the year.

Carbo Ceramics engages in the production of ceramic components used in natural gas and oil wells. The company was founded in 1987, has a market cap of $1.30 billion and is headquartered in Irvine, Texas.

Second-Quarter Results

With crude prices remaining at elevated levels, oil services companies continue to experience strong demand for their products and services. This dynamic was evident when Carbo reported impressive second-quarter results on Aug 5.

Revenue was up 32% from last year to $103 million. Net income totaled $13.5 million, producing earnings of 55 cents per share, ahead of analyst estimates by 4 cents.

It was the fourth time in four quarters that the company has surprised and beaten analyst estimates, having done so by an average of 3 cents, or 5.76%.

The CEO Speaks

President and CEO Gary Kolstad shared some bullish comments about the company, saying, "We believe the market for all proppant is relatively tight, and we have recently implemented price increases and applied energy surcharges in some markets. We are experiencing inflationary cost pressures in raw materials and energy, and our near-term focus will be on improving margins in the proppant business as well as the continued growth potential of overseas sales volume and Pinnacle Technologies."

Analyst Estimates

In light of the bullish energy environment, analysts have continued to revise their earnings estimates upward. The current-year estimate is up to $2.34 per share from $2.28 60 days ago.

The next-year estimate is bullish as well, pegged at $2.76 per share, an 18% earnings growth projection.

Based upon the current-year estimate, this stock is trading at a premium to the overall market, carrying a forward P/E multiple of 22X.

The Chart

Shares of CRR have had a great year, advancing from a low just above $31 to the recent high above $62. This stock has been volatile over the last few weeks, but bears the favor of a long-tern trend line that is very much in play and providing support when shares have dipped lower. Take a look at the chart below.