As Halliburton Goes, So Goes the Oilfield Sector

What’s good for Halliburton is good for the entire oilfield services sector. That’s the investor sentiment behind this week’s news that Halliburton’s fourth quarter earnings had more than doubled. In fact, the news about Halliburton, the second largest oilfield services company in the U.S., did more than boost oilfield services stocks, it lifted U.S. equities overall on January 24, according to the Financial Times. Alcoa, the world’s largest aluminum producer; Cliffs Natural Resources, the iron ore and coal mining company; and the S&P materials index, all ticked upwards following the Halliburton announcement.

That lift didn’t seem to last long. Smallcap stocks in the oilfield services sector generally dropped back down on January 25. But the Halliburton dose of optimism was no doubt welcome nonetheless. Here’s a short capsule look at a few randomly chosen smallcaps in the sector. We’ll check back on this sector in the coming months.

Texas-based Lufkin Industries (Nasdaq:LUFK, http://www.lufkin.com/), a company that sells, manufactures and repairs oil field pumping units, enjoyed an initial bump from the Halliburton news, but dropped nearly 1.5 percent to $60.62 the next day (Jan. 25). Only two years ag this was a $90 stock.

Midland, TX-based Basic Energy Services Inc. (NYSE:BAS, http://www.basicenergyservices.com/), which provides a range of oil and gas drilling and producing companies in the U.S., also ticked down to $16.32 January 25 after getting an initial bump from the Halliburton news. BAS, with a market cap of $673 million, is trading near its 52-week high of $17.84. Earlier this month, TheStreet.com Ratings stock model upgraded BAS from sell to hold.

Houston-based Cal Dive International (NYSE:DVR, http://www.caldive.com/), a contractor of offshore platform, diving and underwater pipelay services with a market cap of $567 million, got a small bump from the Halliburton news, but is languishing around $6 a share. Investopedia picked DVR in early January as one of six stocks (and one of the few small companies) that will profit from ongoing Gulf infrastructure upgrades. It’s currently trading near its 52-week high of $7.97 which it hit last April, just before the BP disaster.

Huntington, WV-based Energy Services of America (AMEX:ESA, http://www.energyservicesofamerica.com/) is a $50 million market cap company that provides contracting services including construction, replacement and repair of natural gas pipelines and construction of intrastate and interstate pipelines, among other services. The Halliburton news may have provided a short lift to their stock price, but nothing that lasted a day of trading. The stock has enjoyed a nice roll since early November, moving from $3.43 to about $4 a share but its average daily volume is only a little more than 16,000 shares a day.

The Woodlands, TX-based Newpark Resources (NYSE:NR, http://www.newpark.com/), a $508 million market cap company that provides fluids management, waste disposal and well site products and services to the oil and gas exploration and production industry.did get a small boost to $5.67 on the Halliburton news and managed to keep most of that through January 25. The stock trades strongly, averaging nearly 1.8 million shares a day, and was as high as $9.50 last September. For more insight into its year-end 2010 results and outlook for 2011, tune into the senior management on its results conference call February 18.

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