NEW YORK (TheStreet) -- Carbo Ceramics (CRR) shares are down 18.2% to $69.12 on heavy volume Monday after the synthetic ceramic proppant and the resin-coated sand supplier said that third quarter sales of its synthetic fracking material fell.
The company reported that sales will fall 18% from the previous quarter, when it sold 454 million pounds of the material. The company said demand fell as customers chose to use sand instead of its synthetic solution.
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TheStreet Ratings team rates CARBO CERAMICS INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CARBO CERAMICS INC (CRR) a BUY. This is driven by several positive factors, 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 compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 41.1% when compared to the same quarter one year prior, rising from $16.31 million to $23.02 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 19.1%. Since the same quarter one year prior, revenues rose by 14.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- CRR has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 3.11, which clearly demonstrates the ability to cover short-term cash needs.
- 37.13% is the gross profit margin for CARBO CERAMICS INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 13.03% is above that of the industry average.
- CARBO CERAMICS INC has improved earnings per share by 40.8% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CARBO CERAMICS INC reported lower earnings of $3.68 versus $4.59 in the prior year. This year, the market expects an improvement in earnings ($4.01 versus $3.68).
- You can view the full analysis from the report here: CRR Ratings Report