A month has gone by since the last earnings report for Silica Holdings (SLCA Quick QuoteSLCA - Free Report) . Shares have lost about 22.5% 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 the most recent earnings report in order to get a better handle on the important catalysts.

U.S. Silica's Q1 Earnings and Sales Beat Estimates

U.S. Silica registered a loss in first-quarter 2019.  The company’s net loss of $19.3 million or 26 cents per share in the period came in against net income of $31.3 million or 39 cents a year ago.  

Barring one-time items, adjusted loss was 8 cents per share, narrower than the Zacks Consensus Estimate of a loss of 14 cents.

U.S. Silica generated revenues of $378.7 million, up around 2.6% year over year. The figure also beat the Zacks Consensus Estimate of $357 million.

Per the company, results were driven by Sandbox business along with a better-than-expected performance of the Oil and Gas sand business and a solid quarter from the Industrial business. It witnessed a recovery in volumes and pricing for Northern White sand. The same trend is projected in second-quarter 2019 as well.

Segment Highlights

Revenues in the Oil & Gas division came in at $260.5 million, down 17% year over year. Overall sales volume rose 19% year over year to 3.864 million tons. Oil & Gas contribution margin declined 41% year over year to $58.6 million or $15.16 per ton.

Revenues in the Industrial and Specialty Products (“ISP”) division were $118.3 million in the quarter, up 110% year over year. Overall sales volume rose 10% year over year to 0.966 million tons. ISP contribution margin was $44.6 million or $46.12 per ton in the period under review, skyrocketing 117% year over year.

Financials

At the end of the first quarter, cash and cash equivalents more than doubled year over year to $161.6 million. Long-term debt was roughly $1,245.2 million in the quarter.

The company also generated operating cash flow of $10.9 million during the quarter.

Outlook

U.S. Silica has reaffirmed its previous guidance for 2019 capital expenditure. It projects capital expenditures in the range $100-$125 million for the year.

For Oil and Gas business, demand and pricing for Northern White sand started to strengthen in the first quarter. Going forward, the company is optimistic about the heightened activity around Northern White sand. It predicts Oil and Gas sand volumes to grow sequentially by low to mid-single digits. This is expected to be supported by a steady expansion in West Texas volumes along with the reactivation of some of Northern White sand capacity.

For Sandbox, the company envisions load volume to rise more than 15% sequentially. The company has a very robust pipeline of potential new opportunities.
 

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 -104.17% due to these changes.

VGM Scores

At this time, Silica Holdings has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Silica Holdings has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.