If you hitched your train to Cameron International Corp. (NYSE: CAM) in late April, as recommended on April 24, 2009, you're up a nice 40%. And that's before the next oil boom begins.

Hence, I'm reiterating my Buy rating for Cameron, first recommended at a price of $25.59.

"Our 'Forecasts Focus List' contains only two energy stocks, both of which are in the oil services sector: Oceaneering International (NYSE: OII) and Transocean (NYSE: RIG)," says blue chip advisor Richard Moroney.

The editor of Dow Theory Forecasts says, "While stocks in the equipment and services group tend to move with oil prices in the near term, their profits depend more on exploration spending than on commodity prices."

"Concerns about slowing demand for crude oil and re?ned products both in the U.S. and overseas have many investors worried. But investors in the equipment and services group should not panic.

"Most producers continue to spend aggressively. And U.S. crude-oil inventories remain well below the average for this time of year, with fewer than 20 days of supply in storage.

"Demand for offshore-drilling services remains strong, giving Transocean excellent growth potential. Consensus estimates project per-share profits will rise 69% in 2008 and 15% in 2009. Transocean, the world's largest offshore drilling contractor, operates in every major drilling region.

"A combination of tight global rig supplies and the ongoing discovery of new offshore reserves have driven rig lease rates higher and kept Transocean's fleet busy. The company's largest, most expensive rigs are 95% sold out for 2009, and the backlog is growing.

It's a reality of the era of elevated energy prices that the oil/natural gas services sector is likely to remain strong for the foreseeable future, baring the discovery of a cheap, widely-available alternative energy. And among oil/natural gas services companies, Transocean (NYSE: RIG) is a standout.

Transocean offers deepwater drilling services in the world's major offshore oil-producing regions, including Africa, Asia, Brazil, Canada, India, Middle East, Gulf of Mexico, and the North Sea.

In general, analysts see RIG generating a 18%-25% total return on equity for 2007-2009, with an upside possible, given the company's strong position in deepwater drilling, which offers a higher return potential than shallow water drilling. And currently, it looks like a 2008 upside is in sight for Transocean: of the company's 82 offshore rigs, only seven have not been committed for 2008. Further, given a capacity shortage sector-wide, dayrates have increase substantially, and look for RIG's pricing power to continue past 2009. (RIG's dayrate for 2006 increased 35% to $142,000 and its rig utilization rate improved 5% in 2006.) The Reuters F2007/F2008 EPS consensus estimates for RIG are $8.01/$11.32.

The risks? RIG's dayrate increases could slow if major oil companies begin to reduce exploration budgets. A U.S. recession could also substantially decease home building, which could lower the demand for oil.

The First Call mean rating for RIG is: Buy. [34 firms.] Mean 2007 target: $131.00. [high: $168, low: $89.] Transocean's share were down $2.04 to $127.60 in Wednesday afternoon trading, but view that dip as a buying opportunity, as it's reasonable to assume that the industrialized nations will need oil services companies for a few years, to say the least.

Stock Analysis: Transocean is a moderate-risk stock not suitable for low-risk investors. Investors with an investment horizon longer than 1 year should be rewarded from RIG's shares. Sell / Stop Loss: $84.