Personal Finance

Emerge Energy Services Blows by Earnings Expectations, Shares Surge

Sand mine at sunset

What happened

Shares of frack-sand supplier Emerge Energy Services (NYSE: EMES) were up 11.6% as of 11:45 a.m. EDT today. Today's move comes after the company announced earnings that were well above Wall Street's expectations.

Sand mine at sunset

Image source: Getty Images.

So what

Frack sand has been a red-hot commodity in 2017, and Emerge's peers have been posting profits for the first time in years; until recently, though, Emerge had lagged behind its peers in turning demand into positive earnings results. This trend changed this past quarter as the company reported net income of $0.16 per share. Total revenue for the quarter increased 227%, compared to the same quarter last year, to $101.7 million. Just for reference, analyst estimates expected a $0.03-per-share loss.

Now what

Emerge was slow to respond to the recent uptick in frack sand. While many of its peers were making aggressive moves with new mines and other investments, Emerge was still trying to repair its balance-sheet damage from the recent oil crash. It has since worked to make up for it by buying a sand facility in San Antonio, and started producing from that plant this past quarter. Hopefully, sand demand will remain high as it brings that facility and its Kosse, Texas, mine back up to full production levels.

EMES data by YCharts .

Overall, Emerge looks like it's in much better shape than it was in prior quarters. The next question for investors is when the company will get back to paying a distribution.

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Tyler Crowe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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