CARBO Ceramics, Inc. (NYSE:CRR)

Carbo Ceramics makes some of the best proppant in the entire industry. Unlike US Silica's sand-based proppant and Chinese low-quality sand/ceramic proppant, Carbo Ceramics makes ceramic proppant that is high in quality. In doing so, Carbo Ceramics improves the yields of the companies that it does business with (Halliburton and Schlumberger). This fact has started to greatly improve Carbo Ceramics' position with these and other drillers as drillers are starting to realize that Carbo Ceramics can provide them with a greater ROI.

In addition, Carbo Ceramics is in the process of opening a new plant in the Bakken in order to be closer to its customers so that it does not have to deal with shipping its inventory to the Bakken. This should help greatly in reducing logistical costs (which I can imagine are high considering that proppant is dealt with in millions of tons).

It is very important to also consider that, while rig counts are currently depressed, they will not likely stay that way in the long run. Many experts are starting to figure that there will be a large economic boom resulting from the Bakken oil drilling as well as other American drilling. Resulting from this will be increased focus on oil plays and other liquid plays. As anyone will agree, a rising ocean lifts all boats... and Carbo Ceramics is one of those lucky boats.

Making an investment in Carbo Ceramics protects the investor from the commodity prices of oil to some degree since all drillers will need proppant of some kind in order to continue fracking operations. Though rig count may increase or decrease, Carbo's products will still be needed regardless.

This is why I'm putting Carbo Ceramics as outperform for the long-term.

High vOLUME bREAK OUT 1/31/13

Fracking anyone?

Price is falling due to oversupply of NG and a fear of fracking reducing the demaind for their proppant. However, fundamentally, their business model is sound, and they will rebound in the long run. I may be getting in before the bottom, but I don't want to miss this ride.

Stock fracking at a low price :).

No debt and good margins.

Fool screen with ROE high, ltDepbt=zero, earnings up for 3 years 10%, etc.Market is around 1300 - I see support at 1200 although we are in downtrend and Europe is scary. It's a game - hope for the best.

the drop in natural gas prices has decreased the need for fracking supplies, but you would be a fool to think that any momentary drop in price won't eventually be just a aberration.. there is never a long term surplus of energy...and therefore, these guys will be back in the money before you know it...as it is they are still making alot of money ...even with the prices down...just off 52 week lows

I'm adding CARBO Ceramics as a nat gas play. A small cap flirting with a 52-week low, CRR provides high-quality ceramic proppant used in fracking, they are expanding production, and they pay a decent dividend (1.15%). Huge short interest in this stock (35.87%).

No debt, consistently high and growing ROE, below average P/E ratio, increasing net margin and book value, high current ratio.

My value investing spreadsheet gives a $150 conservative estimate, with an absolute minimum of $105 (which is still a 25% gain).

Spreadsheet:
https://docs.google.com/spreadsheet/ccc?key=0AkDIbisT56fqdHhEOVFka25FYkszR2dBSzVReGg3WVE

Carbo is being beaten down due to low natural gas prices. However, the driver of the business is natural gas usage and fracking for gas and oil. Fracking will continue to grow globally. CRR is at a better price than seen in a long time with a bright future.

Accelerating EPS screen. Oversold

short squeeze.

Click the video to see my pitch. http://www.fool.com/investing/general/2012/02/24/top-10-energy-stocks-devon-energy.aspx

Rising Star Buy: http://www.fool.com/investing/general/2012/02/27/this-energy-stock-is-music-to-my-ears.aspx

The U.S. is addicted to low-price natural gas, which will require a continuation of the current high level of industry activity, and a ready source for ceramic proppant.

Fracking will only increase as we increase oil production domestically.

Fracking technology has energized some tired markets. It has its risks, though. Environmentalists vilify it. Success like Carbo Ceramic's generates competition. I like it in the next 24 months, but watch the newscasts and people trying to elbow their way into the game.

Technical Pullback Likely