CARBO Ceramics (CRR -12.2%) plunges after one of its largest customers, energy exploration company Rosetta Resources (ROSE +0.3%), said it would stop using ceramics on some of its wells.
In its Q2 earnings report, ROSE said it would switch to using sand proppant for its Eagle Ford wells and no longer use ceramic proppant.
ROSE's decision appears to have caught CRR by surprise, William Blair analyst Brandon Dobell says, adding that CRR believes it will quickly find buyers for the ceramic it was going to sell to ROSE; in the unexpected event that CRR is unable to sell any of the ceramic that was supposed to go to ROSE, Dobell says CRR's 2015 EPS would drop to $2.90-$3.48 from his previous estimate of $5.24.
Shares of Carbo Ceramics (CRR +22.9%) skyrocket at the open after the supplier of ceramic proppant and resin-coated sand beat expectations for Q3 earnings and revenues.
The 33% Y/Y increase in total revenues is mainly attributed to a 48% rise in proppant sales volumes, offset by a 6% drop in the average proppant selling price; North American proppant sales volumes rose 63%, while international sales volumes fell 17%.
CRR says it is accelerating the planning stages of Millen Line 2, which will have a 250M lb./year capacity; a number of long-lead time items have already been purchased for the line.
Carbo Ceramics (CRR +16.6%) enjoys a big advance after reporting strong Q2 beats in earnings and revenues. While admitting a difficult H1, CRR expects a better H2: "In the latter part of the quarter, we experienced increased demand for ceramics proppants and improved margins."
More on Carbo Ceramics' (CRR -13.9%) Q1 miss: The current industry environment is "challenging" and low-cost Chinese ceramic imports continue to exert "pricing pressures." Low prices contributed to both a 10% Y/Y decline in revenues and a 46% Y/Y decline in profits, with higher distribution costs contributing to the latter as well. The outlook for Q2 remains tenuous due to "historic low" prices for Chinese ceramic proppant and seasonal factors. (PR)
Carbo Ceramics (CRR -2.6%) slips today after Goldman Sachs initiates coverage with a cautious Neutral rating and $110 price target. Goldman says the company, which primarily manufactures ceramic proppant used to keep fractures open in oil/gas wells, is faced with a challenging environment where drillers are focusing on cost controls, and normalizing oil/gas prices are driving a preference near-term for cheaper sand over ceramics.
Carbo Ceramics (CRR +9.3%) soars after the maker of materials to tap shale plays reported better-than-expected Q4 revenue. "The shift towards pad drilling by operators that care about their long-term well results bodes well for steadily increasing proppant volumes," Global Hunter says in upgrading shares to Buy from Neutral and raising its price target to $98 from $74.
Carbo Ceramics (CRR +13.7%) shares soar after Q3 earnings beat estimates, as gains in international sales volumes partially offset declines in North America. CRR said Chinese ceramic proppant inventory look to be declining and pressures on volumes and price should lessen in coming quarters; it also discussed development for a new proppant that could raise the bar vs. the competition.
Carbo Ceramics (CRR -1.7%) is downgraded to Hold from Buy at Dahlman Rose, which says it does not expect shares to rally again until Haynesville activity rebounds. The firm says imports have decreased from record levels but have been more resilient than expected and increased in Q3; higher imports and recent price anecdotes increase EPS uncertainty.
Shares of Carbo Ceramics (CRR -6.5%) tumble after a class-action lawsuit is filed in New York federal court alleging the company issued false and misleading statements relating to the Jan. 26 drop in share prices, when CRR revealed a 70% decline in proppant sales.
Carbo Ceramics Inc is a supplier of ceramic proppant. It provides fracture simulation software, fracture design, engineering and consulting services and a broad range of technologies for spill prevention, containment and countermeasures.