- Demand for sand used in fracking may be rising again, which could lead sand demand to an all-time high by year-end 2018, says Stephens analyst Tommy Moll.
- But sand stocks will remain volatile, Moll warns, due to industry headlines and quarter-by-quarter performance in a business that's "subject to a wide range of transitory disruptions, including weather and rail-related delays."
- Moll initiates coverage of Hi-Crush Partners (NYSE:HCLP) with an Overweight rating and $16 price target, saying the company provides an "end-to-end solution spanning low-cost mines, owned and operated transloads and last-mile logistics," and is committed to increasing distributions to help anchor valuation.
- U.S. Silica (NYSE:SLCA) is started at Equal Weight and a $30 price target, as Moll sees shares range-bound in the near term "as investors digest the debt-financed diversification strategy amid an uncertain frac sand macro environment."