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Most investors would agree that oil and gas companies are the life-blood of the global economy, but not all investors know how, or where, to invest in this key sector. For ideas on smart oil and gas drilling opportunities, today we focused on companies where all their signs point towards near and long term growth. To hone in on the cream of the crop, we narrowed our search to only the companies sporting positive and favorable ratings by oil and gas analysts. We came up with solid list of potential winners.

EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-year expected EPS growth rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.

We first looked for oil & gas drilling stocks. We next screened for businesses that have expected earnings per share growth of more than 25 percent for next year (1-year projected EPS growth rate>25%). From here, we then looked for companies that analysts rate as "Buy" or "Strong Buy" (mean recommendation < 3). We did not screen out any market caps.

Do you think these stocks are undervalued? Use our list to help with your own analysis.

1) Ocean Rig UDW Inc. (NASDAQ:ORIG)

Sector:Basic Materials
Industry:Oil & Gas Drilling & Exploration
Market Cap:$2.06B
Beta:-

Ocean Rig UDW Inc. has a 1-Year Projected Earnings Per Share Growth Rate of 188.71%, and an Analysts' Rating of 1.70. The short interest was 1.33% as of 07/22/2012. Ocean Rig UDW Inc. operates as an offshore drilling contractor worldwide. The company provides oilfield services for offshore oil and gas exploration, development, and production drilling. It specializes in the ultra-deepwater and harsh-environment segment of the offshore drilling industry.

2) Magnum Hunter Resources Corp. (NYSE:MHR)

Sector:Basic Materials
Industry:Oil & Gas Drilling & Exploration
Market Cap:$249.24M
Beta:1.74

Magnum Hunter Resources Corp. has a 1-Year Projected Earnings Per Share Growth Rate of 700.00%, and an Analysts' Rating of 1.60. The short interest was 21.90% as of 07/22/2012. Magnum Hunter Resources Corporation, an independent oil and gas company, engages in the acquisition, exploration, exploitation, development, and production of crude oil, natural gas, and natural gas liquids primarily in West Virginia, Ohio, Texas, Kentucky, and North Dakota, as well as in Saskatchewan, Canada. As of February 27, 2012, the company owned approximately 560,072 net acres, with 170,000 net acres in its core resource areas, including approximately 58,426 net acres in the Marcellus Shale; 61,151 net acres in the Utica Shale; 24,000 net acres in the Eagle Ford Shale; and 75,814 net acres in the Williston Basin. It also had working interest in 15 fields located in the Williston Basin in North Dakota comprising 151 wells and approximately 6,540 net acres, as well as operated 33 vertical and 16 horizontal Marcellus Shale wells. In addition, the company owns property interests in approximately 2,000 operated wells and 87,000 net mineral acres located in the states of Kentucky, Ohio, and West Virginia; a natural gas pipeline; 2 commercial salt water disposal facilities; 3 drilling rigs; workover rigs; and other oilfield equipment.

3) Penn West Petroleum Ltd. (NYSE:PWE)

Sector:Basic Materials
Industry:Oil & Gas Drilling & Exploration
Market Cap:$6.16B
Beta:1.43

Penn West Petroleum Ltd. has a 1-Year Projected Earnings Per Share Growth Rate of 188.20%, and an Analysts' Rating of 2.20. The short interest was 0.83% as of 07/22/2012. Penn West Petroleum Ltd., an exploration and production company, engages in acquiring, exploring, developing, exploiting, and holding interests in petroleum and natural gas properties and related assets in Western Canada. The company's principal proved plus probable reserves are located in Alberta, British Columbia, Saskatchewan, Manitoba, and the Northwest Territories, Canada. It also has proved plus probable reserves interests in Wyoming and North Dakota, the United States.

4) Samson Oil & Gas Limited (NYSEMKT:SSN)

Sector:Basic Materials
Industry:Oil & Gas Drilling & Exploration
Market Cap:$109.13M
Beta:1.34

Samson Oil & Gas Limited has a 1-Year Projected Earnings Per Share Growth Rate of 125.00%, and an Analysts' Rating of 1.00. The short interest was 1.43% as of 07/22/2012. Samson Oil & Gas Limited, together with its subsidiaries, engages in the acquisition, exploration, development, and production of oil and gas properties in the United States. It holds interests in the North Stockyard project in Williston Basin, North Dakota; the State GC Oil and Gas field in Lea County, New Mexico; the Sabretooth Prospect in Brazoria County, Texas; the Hawk Springs project in Goshen County, Wyoming; and the Roosevelt project in Roosevelt County, Montana. The company was founded in 1980 and is headquartered in Perth, Australia.

5) Hercules Offshore, Inc. (NASDAQ:HERO)

Sector:Basic Materials
Industry:Oil & Gas Drilling & Exploration
Market Cap:$589.43M
Beta:3.10

Hercules Offshore, Inc. has a 1-Year Projected Earnings Per Share Growth Rate of 165.90%, and an Analysts' Rating of 2.50. The short interest was 9.94% as of 07/22/2012. Hercules Offshore, Inc., together with its subsidiaries, provides shallow-water drilling and marine services to the oil and natural gas exploration and production industry worldwide. Its services comprise oil and gas exploration and development drilling, well services, platform inspection, maintenance, and decommissioning services in various water provinces. As of February 23, 2012, the company owned and operated a fleet of 42 jackup rigs, 17 barge rigs, 2 submersible rigs, 1 platform rig, and 58 liftboat vessels, as well as operated 5 liftboat vessels owned by third party.

6) Vantage Drilling Company (NYSEMKT:VTG)

Sector:Basic Materials
Industry:Oil & Gas Drilling & Exploration
Market Cap:$440.74M
Beta:1.97

Vantage Drilling Company has a 1-Year Projected Earnings Per Share Growth Rate of 271.40%, and an Analysts' Rating of 1.90. The short interest was 6.65% as of 07/22/2012. Vantage Drilling Company, through its subsidiaries, provides offshore contract drilling services to oil and natural gas companies in the United States and internationally. The company offers drilling units, related equipment, and work crews under contract to drill oil and natural gas wells. Its fleet of owned and managed drilling units comprises four jackup rigs and three drillships.

*Company profiles were sourced from Finviz. Financial data was sourced from Yahoo Finance.

Source: 6 Analyst-Backed Oil And Gas Drilling Stocks Headed For Growth