This Is What's Fueling Forum Energy Technologies Inc.'s 13% Surge

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Forum Energy Technologies Inc. were up more than 13% on Friday thanks to two driving forces. First, the price of oil rose about 3% today, taking oil-related stocks like Forum along for the ride. On top of that, Scotia Howard Weil issued an updated research report on the company and gave it a $24 price target, suggesting 49% upside before today's surge.

So what: Still, neither of these two drivers is all that meaningful. The price of oil has been volatile lately, and that will persist until the glut of oil is worked off. Some positive data has indicated the oversupply issue might be tamed in the second half of the year, which could lead to a higher oil price and more business for oil-related companies such as Forum.

Meanwhile, the analyst report wasn't overly bullish -- in fact, the company's price target was actually reduced from $27 to $24. However, that's still well above the current price of about $18 per share, so investors see this as a positive sign. Investors are also overlooking Scotia Howard Weil's sector perform rating on the stock, which means its performance is expected to be on par with other energy stocks over the next few months.

Now what: Forum and similar stocks will remain volatile when the price of oil makes a big move, as its future is dependent on higher oil prices. That means today's movement is essentially meaningless -- the price of oil could just as easily take a dive next week and take the stock down with it.

The article This Is What's Fueling Forum Energy Technologies Inc.'s 13% Surge originally appeared on Fool.com.

Matt DiLallo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.