6 stocks set to soar

Helix is an oil company with a niche that is decidedly different from Arena's. While Helix owns stakes in several Gulf of Mexico oilfields, its main business is not production but offshore services - i.e., constructing wells, laying pipe, and providing other services related to the operation and upkeep of deepwater offshore oil rigs.

Falling oil prices have sent the stock skidding from $42 on June 30 to $29 in early September. Now Helix is invitingly cheap, trading at a mere eight times expected 2008 earnings. Indeed, Helix's oil and gas reserves alone may be worth $35 a share, according to Natixis Bleichroeder energy analyst Roger Read. Plus, there's another $6 a share in value coming from Helix's 58% stake in publicly traded Cal Dive International. In other words, you've got $42 a share in value just from Helix's noncore businesses. And the core oil services business is the one providing most of the growth, with revenues expected to climb 23% this year and another 28% in 2009, according to Read. The analyst consensus for earnings-per-share growth: 17% this year and 24% next.

"They're one of the few companies out there that is really focused on deepwater work, and right now you're seeing a wave of new work in deepwater drilling," says Mark Madsen, a senior analyst with small-cap specialist Wasatch Funds. "It's one of my favorite stocks, and we're even more excited now that the stock has taken a hit."

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