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One theme that has worked nicely over the last few years and should work again in 2014 and beyond is to hitch your wagon to the huge energy boom going on in this country thanks to "fracking" and other new drilling technologies. Over the past five years, domestic oil production is up more than 50% and the United States is well on its way to becoming the biggest oil & natural gas producer in the world.

The continuing impacts of this boom are substantial. A recent IHS Global study was cited in Barron's this weekend. It estimates spending on just energy infrastructure (pipes, railcars, storage tanks, pumps, refining equipment ….etc.) has gone from $55B in 2011 to $60B in 2012 before shooting up to $90B in 2013.

We are in the early innings of this fracking led boom. IHS estimates this infrastructure spending will pump $890mm to $1.15T in capital expenditures into the economy through 2025. Investors can play this long term capital surge in a variety of ways. In order to keep this list manageable, this theme will be broken up into several articles over the next week. With that, it is time to look at some long term winners riding this fracking wave.

Let's start with fracking arms merchant Halliburton (NYSE:HAL). The company has much more expose to North American shale production than its larger competitor Schlumberger (NYSE:SLB). Halliburton also just reported earnings this morning that beat on top and bottom line expectations. Earnings were up 19% Y/Y.

The mean analyst price target on the stock by the 29 analysts that cover the stock is just under $65 a share, more than 25% above its shares current price in the market. Stern Agee, Deutsche Bank & Goldman Sachs have recently named Halliburton as one of their favorite oil services plays in the New Year.

After showing tepid growth in 2013, revenues should post ~10% gains in 2014. The stock sports a five year projected PEG of less than 1 (.74). The consensus estimate also has Halliburton growing earnings by more than 35% over 2013's levels in 2014. The stock is attractive at just over 12x forward earnings, a ~20% discount to the overall market multiple.

I continue to be a believer in the long term story for oil tankcar manufacturer American Railcar (NASDAQ:ARII). Earnings look like they will post a ~30% gain this fiscal year. Given that revenues are projected to increase by the low teens in 2014 another 10% earnings gain in fiscal 2014 looks like a solid expectation. ARII goes for just under 11x forward earnings. The stock sells for a five year projected PEG of under 1 (.77).

I also think a recent spate of oil train crashes and derailments recently could trigger new safety standards for tank cars both in the United States and in Canada. American Railcar should benefit if this comes to fruition as railroads order new cars or refurbish old ones to meet the new standards.

Carl Icahn owns stakes in both American Railcar and competitor The Greenbriar Companies (NYSE:GBX). He has pushed to combined these two manufacturers in the past and perhaps could be a catalyst again sometime in 2014. The stock pays a 2.2% dividend yield and goes for ~5x operating cash flow.

Source: Riding The Fracking Boom To Profits - Part I