Analysts have been prompted to push through two earnings upgrades in as many months for a growing industrial services and rental group, yet the shares can be purchased on a modest PE ratio of 14. Importantly, the majority of the demand drivers are structural which augurs well for the earnings upgrade cycle to continue for quite some time yet.
Moreover, with net debt being paid down sharply, and a sale on the cards of one of its businesses, investors are likely to focus once again on what is a strong earnings story and one that is being seriously undervalued.
The revenue profile of the company has been transformed in the last few years, with one of its businesses now hiring out the bulk of its equipment for gas and geothermal energy exploration, whereas before it had been heavily exposed to the oil industry. This previous dependency on the fortunes of oil companies had seen the companies share price tank 90 per cent from its 2014 high, but the market has yet to appreciate how much this company has changed.
Most excitingly, the company's other main business is wonderfully positioned to take advantage of two huge growth stories. The first is the boom in battery storage, as the world transitions to electricity grid infrastructure that is compatible with an energy future led by renewables. The second opportunity is in powering big data centres, which are thriving thanks to the explosion in e-commerce.