Increasing Our FVEs for Frac Sand Companies Owing to Higher Demand Outlook
We are increasing our fair value estimates for the proppant producers we cover following an update to our frac sand outlook. U.S. Silica moves to $31 per share from $26.50, Hi-Crush Partners to $13.50 per unit from $10, Fairmount Santrol to $4.50 per share from $3.75, and Smart Sand to $8.25 per share from $6.50. Overall, the higher valuations are a result of a higher proppant demand forecast, somewhat offset by increased forecasts for low-cost regional sand supply. Each of these companies still...Fairmount Santrol Holdings is a provider of sand-based proppant solutions used by exploration and production companies for their oil and gas wells. The company also provides sand-based products to end users in the industrial and recreational products (I&R) markets. The company is organized into two segments: proppant solutions and I&R. The proppant solutions segment provides sand-based proppants for use in hydraulic fracturing operations throughout the U.S. and Canada, Argentina, Mexico, China, northern Europe and the United Arab Emirates. The I&R segment provides raw, coated and blended sands to the foundry, building products, glass, turf and landscape and filtration industries primarily in North America.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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