OII has a Very Bullish Chaikin Power Gauge Rating and has been leading the SPY since December 2020. The OB / OS Indicator is in the OS position and Chaikin Money Flow is bullish. A quick glance at the scorecard and shows all green checkmarks. OII is above the long-term trend line with price-based support in the $10 area, with stronger support between $8.50 – $9 at the long term-trend. It has a 21-day Average True Range of $0.81, which is a measure of how much the stock can move on any given day. EPS estimates have been raised recently and the company is due to report at the end of April. Again, use stops in accordance with your risk management rules that make sense for your situation.
OII, serves multiple industries including Oil and Gas, material handling, renewable energy, aerospace, entertainment, and maritime cargo logistics. With so many verticals this diverse company has multiple lines of business that are being revived, seemingly all at once. With strong free cash flow levels, higher demand for most segments of their business, and reduced headwinds in the oil and gas industry due to rising oil prices, OII stands to benefit. Management highlighted several areas of growth on their last earnings call. This company is also well positioned from a balance sheet perspective; they noted $452 million in cash on hand in addition to an untapped $500 million line of credit. With a market cap of a little over $1.2 billion and revenues of $1.8 billion, this small cap name has some fire power if management can continue to deliver.
As with any stock risk management is key, especially on smaller companies. No matter what name you are looking at, I’ve always reminded people to look under the hood when they can. A quick look at their website gives you information that the chart doesn’t. Also, go to the investors page and review some of the recent presentations and earnings call transcripts. It helps to get a sense of the company and the team behind the name.