JJC:   I always stress opportunity on this show... always... opportunity to find stocks that will work on the fundamentals, and get a real boost, if things actually go right... and that's what happened today...

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That's why we return to the same themes over and over and over again... agriculture... infrastructure... healthcare...

And, most importantly, oil... because we're running out of oil...

And that's part of the angle we're playing today, because I found a stock that wasn't up that I thought should have been... and also because of a January celebration of Christmas...

Last night, StatOil, the big Norwegian oil and gas monster, tells us it's running short of oil... I mean, they're a big oil company and they don't have any oil...  They say they won't reach production levels that analysts had expected in 2010 and 2012...  and they're capital expenditures to keep the oil flowing is much higher than expected... they have to be. 

They've got to drill.  If you're an oil company, you need oil..

Hey, BP plc (BP)... same thing.  The stock was down the worst in five years... Why?... Analysts are chattering... they're running out of oil...

What do BP and StatOil have in common, other than they're over there?...

They need to drill, and they're both part of Paz Floor... it's the name of an oilfield... a gigantic oilfield off of Angola... an offshore project.

StatOil owns 23% of this project.  BP owns 16%.

If you ask me, there's one way to play it... and that is... FMC Technologies, Inc. (FTI)!

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This is the ultimate tech drilling company.  FTI a big contract for Paz Floor just the other day.  But, of course, the market's selling off... No one's paying attention to anything, right?  No one's paying any attention to anything good...

The contract was totally out of the blue, but it makes a lot of sense... 

This is a stock - one of a bare handful of stocks - that this market has not been able to keep down... Kind of remarkable.

The stock has held up.  It's just $6.50 below its 52-week-high... that it hit in October, at the end of October, and it's well up for the year so far...

Now, in Cramerica, we think oil's going to $125 this year, and the producers of oil need to spend more and more money investing more heavily in technology, than they ever had to before.  Oil.. tech... what a combo.  Better than PCs... Better than semis...

They need to use the tech just to replace the maturing fields, and a lot more than that... if they want to grow.

So, what's FTI's place in the foodchain?... What do they actually do?...

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Well, this is a company that makes... Sub-sea trees...  They're machines that you put on top of underwater oil wells after you finish drilling that regulates the flow of oil and gas, and also to inject the chemicals, water, gas and other liquids needed to keep a well flowing healthily...

You need one of these trees for every well!...

FTI is the largest maker of (these) trees... controlling about 40% of the market for them.  They're next biggest competitor is Cameron International Corporation (CAM), which has 30% of the market.

In a world where oil is going to $125, and reserves are depleting, companies need to drill more in offshore, nutty locations like Angola...  FTI should be practically printing money!  And they pretty much are...

They're winning these big contracts like the Paz Floor field in Angola... that was for 49 trees.  $980 million.  Hey, money grows on these trees... a much larger amount of money than anyone thought.

FTI was also one of two companies awarded a sub-sea equipment and services contract, from the struggling StatOil... The whole thing could be worth $2.6 billion to $4.4 billion...

There are more sub-sea contracts coming, which should keep the stock going higher.

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Over the next 15 months, there are at least 12 sub-sea contracts for trees that are going to be coming, and every one of them is going to be worth millions...

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Given FTI's pre-eminence in the sub-sea tree market, and the need for these trees, it's not outrageously optimistic to expect them to get more big wins... and those big contracts don't include the big Petroleo Brasileiro (PBR) find... that's the offshore Tupee oil field... that is so big, but it's going to use every bit of technology that we have.  It's very hard to get to.

FTI is a great play, but I don't want you to get the impression it's going to be easy to make a lot of money right now.

We had a nice day today, but you know I'm emphasizing caution everyday on the show...

We're really oversold.  The market bounces... it hit the August low of 12,500... it bounced... but I think emphasizing capital protection - because the economy's in terrible shape - is the right thing to do...

Who knows if the Fed notices... They're concerned about inflation in food and oil... Hey, this is a great play on them.  They kind of exclude all the real problems...

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Now, I wouldn't be recommending this stock, if I didn't believe it also had some downside protection...  I've got two things going for it that should protect the stock from falling, okay?

First, they've got a gigantic buyback... Even though it's an oil service stock, it's got 14 million shares left to buy - 11% of the stock outstanding.  Pretty big, right?...

That's your cushion, if for some reason the insanity of this market starts to bring down high-quality members of the oil patch...

The second piece of protection is that, even though the stock is $6.50 off its high, it's still pretty cheap, trading at 22x earnings with a 20% growth rate... You know my rule of thumb... if the price-to-earnings (i.e., the P/E) is lower than the growth rate, and the fundamentals are sound, then you've got a real cheap, cheap, cheap stock - buy, buy, buy!...

I should also mention that FTI plans on spinning off their legacy business by the middle of the year... it's the old food machinery business and airport recs...  They can sell it for a nice chunk of change.  Management expects they're worth anywhere between 8-11x their earnings before income, taxes, and depreciation...  It's a $650 to an $800-900 million legacy business...

That spinoff will make FTI into the pure play in oil and tech that we all want, you and me...

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The Bottom Line!:    Oil's still working... the market's looking a little better...  FMC Technologies, Inc. (FTI) is the best way to play the next round for deep-water contracts for all these gigantic oil companies that are disappointing people, because they're not finding enough oil.

[See Jim's 2nd Opening Segment stock picks below... ]