U.S. Silica was gaining 1.5% to $27.12 Monday.
The bank set a price target of $33 to $35 for the company. Analyst Matthew D. Conlan said the company's stock has fallen to an attractive entry point.
"SLCA's recent earnings preannouncement and below-consensus 2014 guidance set expectations for SLCA's per-ton profits to remain fairly flat in 2014 and lowered the stock's valuation to a level we feel is an attractive (re)entry point," Conlan wrote. "In line with SLCA's most recent (seemingly conservative) guidance, we are lowering our 2013/2014 EPS estimates to $1.43/$1.97 from $1.56/$2.42, with a 2015 EPS estimate of $2.79."
Separately, TheStreet Ratings team rates U S SILICA HOLDINGS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate U S SILICA HOLDINGS INC (SLCA) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, increase in net income, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 1.9%. Since the same quarter one year prior, revenues rose by 24.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 30.66% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SLCA should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has exceeded that of the Metals & Mining industry average, but is less than that of the S&P 500. The net income increased by 13.5% when compared to the same quarter one year prior, going from $18.80 million to $21.33 million.
- 36.98% is the gross profit margin for U S SILICA HOLDINGS INC which we consider to be strong. Regardless of SLCA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 14.77% trails the industry average.
- U S SILICA HOLDINGS INC has improved earnings per share by 11.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, U S SILICA HOLDINGS INC increased its bottom line by earning $1.50 versus $0.58 in the prior year. For the next year, the market is expecting a contraction of 2.0% in earnings ($1.47 versus $1.50).
- You can view the full analysis from the report here: SLCA Ratings Report