A month has gone by since the last earnings report for Silica Holdings (SLCA - Free Report) . Shares have lost about 17.8% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Silica Holdings due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
U.S. Silica Misses Earnings & Sales Estimates in Q2
U.S. Silica recorded a profit of $17.6 million or 22 cents per share in the second quarter of 2018 compared with $29.5 million or 36 cents in the year-ago quarter.
Barring one-time items, adjusted earnings came in at 64 cents per share, which missed the Zacks Consensus Estimate of 68 cents.
U.S. Silica reported revenues of $427.4 million, up around 47.2% year over year. However, the figure missed the Zacks Consensus Estimate of $440.8 million.
Revenues in the Oil & Gas division were $324.1 million in the quarter, up about 38% year over year. Overall sales volume rose 26% year over year to around 3.465 million tons.
Revenues in the ISP division came in at $103.4 million, up 86% year over year. Overall sales volume rose 15% to around 1.024 million tons.
U.S. Silica had $322.4 million in cash and cash equivalents at the end of the second quarter, down roughly 85.6% year over year.
Long-term debt rose to $1,253.4 million from $506.3 million in the prior-year quarter. Total debt was $1,267.4 million. Capital spending in the quarter was $86.9 million.
U.S. Silica expects capital expenditures for 2018 to be roughly $350 million.
For the third quarter, the company expects volumes in the Oil & Gas segment to rise in the range of 20-25%, as the is ramping up new capacity in West Texas and also bringing Brownfield expansion projects online.
U.S. Silica expects strong performance and improved volumes in Sandbox in the third quarter as it continues to add crews.
For the ISP unit, the company expects sequential increases in pricing and margins on the back of strategic price increases implemented during second quarter and a full quarter of results from EP Minerals.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -10.19% due to these changes.
Currently, Silica Holdings has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is equally suitable for value, growth, and momentum investors.
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Silica Holdings has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.