Flotek (FTK) provides oilfield chemicals, logistics, and downhole drilling and production equipment to the oil and gas industry. The key growth driver is their technology, primarily chemicals and equipment, for removing oil and gas from shale rock. The company ran into financial trouble in 2009, but they have since turned around, ramping up sales and earnings and paying down debt. In their recent quarter, the company reported earnings of $0.20 per share (vs. a loss in 2010), beating estimates by $0.05; revenues rose 57.7% year/year to $74.9 mln vs. the $76.34 mln consensus. In strong demand by institutional money, the number of mutual funds owning the stock has increased dramatically over the past year: Mar-2011 — 66, Jun-2011 — 112, Sep-2011 — 127, Dec-11 — 156. The stock appears inexpensive with a forward P/E under 15 and year over year earnings growth forecast at 59%, giving it a PEG of 0.25.
Today the stock is clearing resistance in an 8-week consolidation on strong volume, a good place to add shares.