Market Overview

U.S. Silica Has 'Growing' M&A Prospects, Cowen Says

Share:

Cowen’s Marc Bianchi maintained an Outperform rating for U.S. Silica Holdings Inc (NYSE: SLCA) after the company announced an 8.7 million share equity offering.

The equity offering is around 16 percent dilutive, excluding the green-shoe option of 1.33 million shares. Assuming an offer price of $20 per share, the offering is expected to generate gross proceeds of $174 million, analyst Marc Bianchi mentioned.

“We view this as an opportunistic equity offering in light of an open equity issuance window and a growing list of M&A opportunities, however nothing specific appears to be identified for these proceeds,” Bianchi wrote.

Acquisition Plans

U. S. Silica raised its term loan by $115 million in July 2013 and acquired Cadre Services in July 2014. Although U. S. Silica’s near-term acquisition plans could include “non-traditional frac sands, logistics assets, or something within ISP,” over the long-term, the company is committed to making a transformation acquisition, the analyst said.

A transformation deal of public or large private companies is likely to require more capital. Following this offering U. S. Silica will have $470 million cash and cash equivalents, Bianchi pointed out. The company’s net debt is also expected to be reduced to $20 million.

Latest Ratings for SLCA

DateFirmActionFromTo
Mar 2020BarclaysUpgradesUnderweightEqual-Weight
Mar 2020Morgan StanleyMaintainsUnderweight
Nov 2019Johnson RiceDowngradesAccumulateHold

View More Analyst Ratings for SLCA
View the Latest Analyst Ratings

 

Related Articles (SLCA)

View Comments and Join the Discussion!

Posted-In: Cowen Marc BianchiAnalyst Color Long Ideas Reiteration Analyst Ratings Trading Ideas

Latest Ratings

StockFirmActionPT
BBCanaccord GenuityMaintains6.0
ATROCanaccord GenuityMaintains14.0
GMCFRAMaintains20.0
ZGCitigroupMaintains44.0
XYLCitigroupMaintains68.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com