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In a report published Thursday, Bank of America analyst Vaibhav Vaishnav reiterated a Buy rating on
U.S. Silica HoldingsSLCA, and raised the price target from $70.00 to $83.00.
In the report, Bank of America noted, “We came away more bullish on U.S. Silica's (SLCA) stock following its Sept 9-10 investor conference given higher-than-expected imbedded margin guidance. The company raised 2014 EBITDA guidance to a mid-point of $235mn from $220mn, consistent with our $234mn forecast. More importantly, SLCA offered a 2017 EBITDA mid-point of $575mn vs our $450mn+ expectation, and initiated a 2020 target of $1.0bn (1B20). Guidance implies a 2014-2020 CAGR of approximately 25% and is particularly encouraging given management's conservative approach. We continue to forecast secular growth in frac sand demand owing to rising proppant intensity and are raising our 2015/16E EPS to $4.20/$6.35 from $3.50/4.65. Our PO increases to $83 from $70, 13x '16E EPS. We introduce 2017 EPS of $6.75.”
U.S. Silica Holdings closed on Wednesday at $69.41.
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