As rig counts and frac fleet counts fall, but well laterals and perforating charge density keep growing, another possible way to invest in the shale revolution is to own the sand, or proppant in their jargon.
i own snd since a few years as a 3% position. its a bit lonely due to not much happening to the share price but offers good diversification from my mostly healthcare/junior gold miner portfolio and at this valuation is hard to ignore.
my price target is 8 in 5 years. it is growing revenues (6xed in 10 years) now it just has to figure out profits.
the chart has upside potential with the triangle formation.
Yes and no, the net income situation looks bad, but huge depreciation makes for cash flow positive status. If frac spreads worsened and ACDC were losing money, the founding family would bail it out, but they would extract some sweet preferred stock for themselves. That would be a sort of common dilution. The big threat isn't bankruptcy, it's the Wilks family taking the thing private.
🙏🏻 Is it possible that the Wilks family is “hoping” for further decline to take the company cheaply private? Why don't they do a buy back to support the shareprice?
Buybacks are often unwelcome when controlling shareholders have so much. The stock price might rise on an increase of the free float. I think the Wilks know that the business is cyclical, and are focusing on rolling up and consolidation
i own snd since a few years as a 3% position. its a bit lonely due to not much happening to the share price but offers good diversification from my mostly healthcare/junior gold miner portfolio and at this valuation is hard to ignore.
my price target is 8 in 5 years. it is growing revenues (6xed in 10 years) now it just has to figure out profits.
the chart has upside potential with the triangle formation.
Can ACDC go bankrupt? What’s there margin of safety?
Yes and no, the net income situation looks bad, but huge depreciation makes for cash flow positive status. If frac spreads worsened and ACDC were losing money, the founding family would bail it out, but they would extract some sweet preferred stock for themselves. That would be a sort of common dilution. The big threat isn't bankruptcy, it's the Wilks family taking the thing private.
🙏🏻 Is it possible that the Wilks family is “hoping” for further decline to take the company cheaply private? Why don't they do a buy back to support the shareprice?
Buybacks are often unwelcome when controlling shareholders have so much. The stock price might rise on an increase of the free float. I think the Wilks know that the business is cyclical, and are focusing on rolling up and consolidation