- U.S. Silica (SLCA -17.1%) plummets after Barclays downgrades shares to Underweight from Equal Weight with a $10 price target, cut from $12, saying it needs to "see more evidence" of the company's plan to expand and diversify its end markets.
- Barclays analyst Dave Anderson praises U.S. Silica for diversifying away from oil and gas by expanding its ISP product line, but says "it's hard to give much credit considering the timing of incremental capex with the uncertain pace of revenue."
- The short-term story in oil and gas "remains challenged as we expect E&Ps to maintain capital discipline at least until 2022, with volumes and pricing to remain at subdued levels," Anderson writes.
- U.S. Silica is highly levered, with a looming $1.2B term loan due in 2025, which the analyst also cites as a concern.
- U.S. Silica is "best in breed" in the frac sand space and should "generate higher sales and margins as the year progresses," Fluidsdoc writes in a bullish analysis posted recently on Seeking Alpha.
U.S. Silica cut to Sell equivalent at Barclays on diversification questions
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Symbol | Last Price | % Chg |
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SLCA | - | - |
U.S. Silica Holdings, Inc. |