Stock market pick: Pason earnings skyrocket in latest quarter

PASON SYSTEMS, symbol PSI on Toronto, rents equipment that its customers use to monitor and manage land-based oil rigs. The stock market pick also provides communication systems, such as its satellite system, which companies use to remotely collect data from their drilling operations. Pason serves oil and gas companies and drilling contractors throughout Canada, the U.S., Mexico and Argentina. In the three months ended March 31, 2011, Pason’s revenue jumped 50.0%, to $84.7 million from $56.4 million a year earlier. The company’s Canadian operations benefited from a cold winter that allowed rig movement on frozen ground until the end of March. Earnings climbed 125.3%, to $17.9 million, or $0.22 a share, from $7.9 million, or $0.10 a share. Stronger oil and gas industry drilling and higher selling prices for the company’s equipment pushed up results. The stock market pick holds cash of $99.9 million, or $1.22 a share, and has no debt. The company is a dividend paying stock. Its shares yield 2.3%. You can get our clear buy/sell/hold advice on Pason and dozens of other stocks that may be appropriate for the part of your portfolio you devote to aggressive investing when you subscribe to Stock Pickers Digest. What’s more, you can get the latest issue absolutely free. Click here to learn how.

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Jim Bates

Jim is an associate editor at TSI Network. He is the lead reporter and analyst for The Successful Investor and Wall Street Stock Forecaster and a member of the Investment Planning Committee. Jim has held the Chartered Financial Analyst designation since 1992 and spent more than a decade at the Financial Post DataGroup before joining TSI Network. He has a Bachelor of Commerce degree from the University of Toronto.

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