The oil service sector has earned short shrift from Wall Street, as all eyes focus on the price of crude oil -- especially how those prices impact the share prices of big oil stocks like ExxonMobil, Shell, and British Petroleum.

That’s an oversight on the part of investors, as the oil service sector seems poised for a big upswing in 2012 – if recent industry studies have things pegged correctly.

One late 2011 study from information and analysis firm IHS says that a strong 2011 has set the stage for an even stronger 2012, as a “perfect storm” of events have the sector poised for growth - - even if investors do risk missing the boat.

“Continued strong performance expected for multi-service providers of oilfield services for 2012, while offshore drillers see measured, but steady growth,” says IHS in its report.

Nothing is perfect, and caveats do exist, but IHS says the outlook for the services sector looks good in most global bourses.

“The shortage of pressure-pumping capacity for multi-stage fracturing is likely to ease in 2012, which may soften margins for these services, but the companies in this sector continue to be bullish on markets outside of North America, with Latin America, South America and the Middle East considered particularly robust,” notes John Parry, senior analyst at IHS, and author of the IHS Herald Special Study on the Oilfield Services Sector.

Parry adds that industry consolidation has left some of the survivors in better shape than ever. “Recent mega-mergers and acquisitions in the sector appear to be paying off for companies such as Schlumberger (Smith), Baker Hughes (BJ Services), and Ensco (Pride). “These deals, which total about $25 billion, have made them even more competitive,” he said.

Even some downward revisions in key corners of the oil service market in 2011 should be short-term, and could lead to bargains for investors. Says Credit Suisse, in a January, 2013 research report:

We expect several of our oilfield services names to "push" 2012 earnings per share lower through fourth quarter earnings season, although generally by less than 10%.

We see possible share weakness due to these revisions as buying opportunities. We acknowledge that the "oilfield services minefield" that emerged in the second half of 2011, which includes more sluggish demand in some cases, more rig downtime, competitive forces and service execution, still persists.

Which oil services companies rank highest on analysts’ radar? Let’s take a look at some of the “leading lights”.

Halliburton -- This oil-services giant released its most recent round of earnings news on January 23 – much to the delight of shareholders. The company, with $14.4 billion in revenues, saw its stock price climb three points, to $37 per share, after the earnings release.

Schlumberger -- Another oil services company out with strong earnings is Schlumberger, which rates as commodities trader Dan Dicker’s top-rated sector stock. Dicker, appearing on CNBC on Jan. 20, says the company’s recent earnings picture comes at a time when the company’s stock has largely underperformed. Schlumberger “has really, really underperformed compared to oil prices,” he said.

Dicker’s not alone. On February 3, 20102, the editors at Better Investing Magazine chose Schlumberger as its April, 2012, “stock to study” for its readers. "The committee chose Schlumberger because of its strong long-term prospects in the oil services industry along with its highly diversified revenue stream and emphasis on the quality of its services," said Adam Ritt, editor of Better Investing Magazine. The stock is currently trading at about $77 per share, with an average analyst one-year target estimate at $90 per share.

Nabors Industry – This land drilling contractor services about 550 land rigs, primarily in North and South America, and another 550 for land well-servicing and workover operations in the U.S., and another 172 in Canada. The stock, which is trading at about $19 per share, with a one-year target estimate of $26 per share, is outpacing its sector average in terms of earnings per share.

That story may be a compelling one, if recent history is any guide:

--------------------------------------------------------------------------

Nabors Industry EPS FY 2010, 2011, 2012

Year Earnings Per Share

2010 $1.13

2011 $1.46

2012 (Est.) $2.25

--------------------------------------------------------------------------

Scorpio Tankers Inc. – STNG can boast a “positive” rating by all eight primary Wall Street analysts who cover the stock. The stock is only trading at $6 per share this week, but it has traded as high as $12 per share in the last year, a landing spot that analyst see Scorpio visiting again.

Market Vector Oil Services -- How about a nice, easy oil services exchange-traded fund that includes a slew of good stock opportunities? OIH is a favorite of both investors and analysts, with one reason being its low entry costs – its expense ration (the RTF’s fee) is a paltry 0.35%. Compare that to 1% or even 2% for most mutual funds and you begin to get the idea.

Fund holdings include Halliburton, Schlumberger, Seadrill (up over 20% over the past 12 months), and National Oilwell Varco (up 9% over the same time). But you’d better get in quick, says the web site ETFChannel.com, which says OIH fund inflows were up over 6% on a week-to-week basis at the end of January, 2012.

One last -- but highly interesting -- point on oil service stocks comes from EquityClock.com, which says the calendar period between January 15 and May 9 is the “busy” season for oil servicers. The web site notes the “seasonal strength” is impacted favorably by seasonal increases in crude oil in February, March and April, in addition to higher demand for rig servicers during the winter drilling period.

So if you subscribe to the theory that “timing is everything”, the smart money on Wall Street is increasingly flowing to oil service stocks right now.