Maintaining Smart Sand FVE After 4Q Results Despite Earnings Surprise
After reviewing Smart Sand's surprisingly strong fourth-quarter results in depth, we are maintaining our fair value estimate of $3 per share. Adjusted EPS of $0.19 in the quarter handily beat the consensus average of $0.13, resulting in the company's shares rallying over 50%. Smart Sand now looks like the the most overvalued proppant company we cover, trading about 45% above our fair value estimate.Along with peers, Smart Sand's results deteriorated sequentially owing to the decrease in overall...
Smart Sand is a frac sand supply and services company. The company is a producer of Northern White raw frac sand, which is a proppant used to improve hydrocarbon recovery rates in the hydraulic fracturing of oil and natural gas wells. The company also provides proppant logistics solutions to its customers through its in-basin transloading terminal and wellsite storage capabilities. The company markets its products and services primarily to oil and natural gas exploration and production companies and oilfield service companies and sells its products under a combination of long-term take-or-pay contracts and spot sales in the open market.
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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