(GW) - For the full year of 2006, six analysts boosted their estimates and five followed suit for 2007

Grey Wolf, Inc. (GW), which is a Zacks #1 Rank stock, met or exceeded analysts' earnings expectations for the past nine quarters. Earnings per share are projected to grow 31.0% over the next 3-5 years. A number of analysts upped their profit forecasts after GW's solid second quarter. The company has a price-to-book ratio of 2.9, compared to 5.3 for the market. Its PEG ratio currently sits at 0.23. Full Analysis Grey Wolf, Inc. is a leading provider of contract oil and gas land drilling services in the United States, serving both major and independent oil and gas companies with a premium fleet of 114 rigs. GW met or exceeded analysts' earnings expectations in nine consecutive quarters and in 14 out of the past 16. Earnings per share grew 8.9% over the past five years and are expected to grow by a much larger magnitude going forward—31.0% over the next 3-5 years. On Jul 31, GW's second-quarter earnings per share came in at 23 cents, matching the Street's estimate while crushing its results in the prior-year period by a robust 91.7%. Revenues ballooned 48.5% to $239.6 million compared with revenues for the second quarter of 2005 at $161.3 million. For the first six months of 2006, profits soared 121.3% to $112.2 million, while revenues jumped 48.6% to $462.5 million. Chairman, President and Chief Executive Officer Tom Richards stated, “By logging record results in each of the past three quarters, Grey Wolf has provided substantial cash flow to finance current and future growth.” The company plans to upgrade its fleet with the cash flow as well as improve its balance sheet and return cash to its shareholders through the buyback of its common stock. The company's current $100 million repurchase program was authorized by its Board of Directors on May 25. GW bought back 1.4 million shares valued at $10.4 million during the second quarter. Since the company reported its second-quarter results, a number of analysts submitted upward earnings estimate revisions. Four analysts raised their profit forecasts for this quarter while five did so for next quarter. For the full year of 2006, six analysts boosted their estimates and five followed suit for 2007. GW is currently trading at a valuation of 9.6x trailing 12-month earnings and at 7.2x current fiscal-year estimated earnings. The market, as represented by the S&P 500, is trading at a valuation of 16.7x trailing 12-month earnings and at 15.7x its current fiscal-year estimated earnings. The company has a price-to-book ratio of 2.9, compared to 5.3 for the market. Its PEG ratio currently sits at 0.23. GW's return on equity more than doubles that of the industry average—43% compared to 20%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. | Blog Home| VitalStocks Home