Intrinsic value of Hi-Crush Partners - HCLP

Previous Close

$9.30

  Intrinsic Value

$23.42

stock screener

  Rating & Target

str. buy

+152%

  Value-price divergence*

-150%

Previous close

$9.30

 
Intrinsic value

$23.42

 
Up/down potential

+152%

 
Rating

str. buy

 
Value-price divergence*

-150%

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of HCLP stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 0.6

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  -40.00
  59.60
  54.14
  49.23
  44.80
  40.82
  37.24
  34.02
  31.12
  28.50
  26.15
  24.04
  22.13
  20.42
  18.88
  17.49
  16.24
  15.12
  14.11
  13.20
  12.38
  11.64
  10.97
  10.38
  9.84
  9.36
  8.92
  8.53
  8.17
  7.86
  7.57
Revenue, $m
  204
  326
  502
  749
  1,084
  1,527
  2,096
  2,809
  3,683
  4,732
  5,970
  7,405
  9,044
  10,891
  12,947
  15,212
  17,683
  20,356
  23,227
  26,292
  29,546
  32,984
  36,604
  40,402
  44,377
  48,529
  52,858
  57,365
  62,055
  66,931
  71,999
Variable operating expenses, $m
 
  67
  103
  154
  223
  315
  432
  579
  759
  975
  1,230
  1,525
  1,863
  2,244
  2,667
  3,134
  3,643
  4,193
  4,785
  5,416
  6,086
  6,795
  7,540
  8,323
  9,142
  9,997
  10,889
  11,817
  12,783
  13,788
  14,832
Fixed operating expenses, $m
 
  242
  248
  254
  260
  267
  274
  281
  288
  295
  302
  310
  317
  325
  333
  342
  350
  359
  368
  377
  387
  396
  406
  416
  427
  438
  448
  460
  471
  483
  495
Total operating expenses, $m
  272
  309
  351
  408
  483
  582
  706
  860
  1,047
  1,270
  1,532
  1,835
  2,180
  2,569
  3,000
  3,476
  3,993
  4,552
  5,153
  5,793
  6,473
  7,191
  7,946
  8,739
  9,569
  10,435
  11,337
  12,277
  13,254
  14,271
  15,327
Operating income, $m
  -68
  17
  151
  340
  601
  946
  1,390
  1,950
  2,637
  3,463
  4,438
  5,570
  6,864
  8,322
  9,947
  11,736
  13,690
  15,803
  18,074
  20,498
  23,072
  25,793
  28,657
  31,663
  34,809
  38,095
  41,521
  45,088
  48,800
  52,660
  56,672
EBITDA, $m
  -51
  44
  192
  403
  691
  1,073
  1,565
  2,184
  2,944
  3,858
  4,937
  6,188
  7,619
  9,231
  11,027
  13,006
  15,166
  17,502
  20,013
  22,693
  25,539
  28,546
  31,713
  35,035
  38,513
  42,145
  45,933
  49,877
  53,980
  58,247
  62,682
Interest expense (income), $m
  11
  9
  20
  35
  56
  85
  122
  171
  232
  307
  396
  502
  625
  765
  923
  1,098
  1,292
  1,503
  1,731
  1,976
  2,238
  2,516
  2,810
  3,119
  3,444
  3,783
  4,138
  4,508
  4,893
  5,294
  5,710
Earnings before tax, $m
  -81
  7
  131
  306
  545
  861
  1,268
  1,779
  2,405
  3,156
  4,042
  5,068
  6,239
  7,558
  9,024
  10,638
  12,398
  14,301
  16,343
  18,522
  20,834
  23,277
  25,847
  28,544
  31,365
  34,311
  37,382
  40,580
  43,907
  47,366
  50,962
Tax expense, $m
  0
  2
  35
  83
  147
  232
  342
  480
  649
  852
  1,091
  1,368
  1,685
  2,041
  2,437
  2,872
  3,347
  3,861
  4,413
  5,001
  5,625
  6,285
  6,979
  7,707
  8,469
  9,264
  10,093
  10,957
  11,855
  12,789
  13,760
Net income, $m
  -81
  5
  95
  223
  398
  628
  926
  1,298
  1,755
  2,304
  2,951
  3,700
  4,555
  5,517
  6,588
  7,766
  9,050
  10,439
  11,930
  13,521
  15,209
  16,992
  18,868
  20,837
  22,896
  25,047
  27,289
  29,624
  32,052
  34,578
  37,202

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  5
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  659
  1,044
  1,609
  2,400
  3,476
  4,895
  6,717
  9,002
  11,804
  15,168
  19,135
  23,735
  28,988
  34,908
  41,498
  48,756
  56,675
  65,243
  74,445
  84,269
  94,697
  105,718
  117,320
  129,494
  142,236
  155,542
  169,416
  183,863
  198,894
  214,522
  230,765
Adjusted assets (=assets-cash), $m
  654
  1,044
  1,609
  2,400
  3,476
  4,895
  6,717
  9,002
  11,804
  15,168
  19,135
  23,735
  28,988
  34,908
  41,498
  48,756
  56,675
  65,243
  74,445
  84,269
  94,697
  105,718
  117,320
  129,494
  142,236
  155,542
  169,416
  183,863
  198,894
  214,522
  230,765
Revenue / Adjusted assets
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
  0.312
Average production assets, $m
  496
  791
  1,219
  1,819
  2,634
  3,709
  5,091
  6,823
  8,945
  11,495
  14,501
  17,987
  21,969
  26,455
  31,449
  36,950
  42,951
  49,444
  56,418
  63,863
  71,766
  80,118
  88,911
  98,137
  107,793
  117,877
  128,392
  139,340
  150,732
  162,575
  174,885
Working capital, $m
  -60
  -33
  -50
  -75
  -108
  -153
  -210
  -281
  -368
  -473
  -597
  -741
  -904
  -1,089
  -1,295
  -1,521
  -1,768
  -2,036
  -2,323
  -2,629
  -2,955
  -3,298
  -3,660
  -4,040
  -4,438
  -4,853
  -5,286
  -5,737
  -6,205
  -6,693
  -7,200
Total debt, $m
  196
  405
  712
  1,143
  1,728
  2,500
  3,491
  4,734
  6,258
  8,088
  10,246
  12,749
  15,607
  18,827
  22,412
  26,360
  30,668
  35,329
  40,335
  45,679
  51,352
  57,348
  63,659
  70,282
  77,213
  84,452
  91,999
  99,859
  108,035
  116,537
  125,373
Total liabilities, $m
  360
  568
  875
  1,306
  1,891
  2,663
  3,654
  4,897
  6,421
  8,251
  10,409
  12,912
  15,770
  18,990
  22,575
  26,523
  30,831
  35,492
  40,498
  45,842
  51,515
  57,511
  63,822
  70,445
  77,376
  84,615
  92,162
  100,022
  108,198
  116,700
  125,536
Total equity, $m
  300
  476
  733
  1,095
  1,585
  2,232
  3,063
  4,105
  5,382
  6,917
  8,726
  10,823
  13,219
  15,918
  18,923
  22,233
  25,844
  29,751
  33,947
  38,427
  43,182
  48,208
  53,498
  59,049
  64,859
  70,927
  77,254
  83,842
  90,696
  97,822
  105,229
Total liabilities and equity, $m
  660
  1,044
  1,608
  2,401
  3,476
  4,895
  6,717
  9,002
  11,803
  15,168
  19,135
  23,735
  28,989
  34,908
  41,498
  48,756
  56,675
  65,243
  74,445
  84,269
  94,697
  105,719
  117,320
  129,494
  142,235
  155,542
  169,416
  183,864
  198,894
  214,522
  230,765
Debt-to-equity ratio
  0.653
  0.850
  0.970
  1.040
  1.090
  1.120
  1.140
  1.150
  1.160
  1.170
  1.170
  1.180
  1.180
  1.180
  1.180
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
  1.190
Adjusted equity ratio
  0.451
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456
  0.456

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -81
  5
  95
  223
  398
  628
  926
  1,298
  1,755
  2,304
  2,951
  3,700
  4,555
  5,517
  6,588
  7,766
  9,050
  10,439
  11,930
  13,521
  15,209
  16,992
  18,868
  20,837
  22,896
  25,047
  27,289
  29,624
  32,052
  34,578
  37,202
Depreciation, amort., depletion, $m
  17
  27
  42
  63
  91
  127
  175
  234
  307
  395
  498
  618
  755
  909
  1,081
  1,270
  1,476
  1,699
  1,939
  2,195
  2,466
  2,753
  3,055
  3,372
  3,704
  4,051
  4,412
  4,788
  5,180
  5,587
  6,010
Funds from operations, $m
  -36
  32
  137
  286
  488
  756
  1,101
  1,533
  2,063
  2,699
  3,449
  4,318
  5,309
  6,426
  7,668
  9,036
  10,526
  12,139
  13,869
  15,716
  17,675
  19,745
  21,924
  24,209
  26,601
  29,098
  31,701
  34,412
  37,232
  40,164
  43,212
Change in working capital, $m
  -9
  -12
  -18
  -25
  -34
  -44
  -57
  -71
  -87
  -105
  -124
  -144
  -164
  -185
  -206
  -226
  -247
  -267
  -287
  -306
  -325
  -344
  -362
  -380
  -398
  -415
  -433
  -451
  -469
  -488
  -507
Cash from operations, $m
  -27
  45
  155
  310
  522
  800
  1,157
  1,604
  2,150
  2,804
  3,573
  4,461
  5,473
  6,611
  7,874
  9,262
  10,774
  12,406
  14,156
  16,022
  18,001
  20,089
  22,286
  24,589
  26,998
  29,513
  32,134
  34,863
  37,701
  40,652
  43,719
Maintenance CAPEX, $m
  0
  -17
  -27
  -42
  -63
  -91
  -127
  -175
  -234
  -307
  -395
  -498
  -618
  -755
  -909
  -1,081
  -1,270
  -1,476
  -1,699
  -1,939
  -2,195
  -2,466
  -2,753
  -3,055
  -3,372
  -3,704
  -4,051
  -4,412
  -4,788
  -5,180
  -5,587
New CAPEX, $m
  -43
  -295
  -428
  -600
  -815
  -1,075
  -1,381
  -1,732
  -2,123
  -2,550
  -3,006
  -3,486
  -3,981
  -4,486
  -4,994
  -5,501
  -6,001
  -6,493
  -6,974
  -7,444
  -7,903
  -8,352
  -8,792
  -9,226
  -9,656
  -10,084
  -10,514
  -10,949
  -11,391
  -11,844
  -12,310
Cash from investing activities, $m
  -126
  -312
  -455
  -642
  -878
  -1,166
  -1,508
  -1,907
  -2,357
  -2,857
  -3,401
  -3,984
  -4,599
  -5,241
  -5,903
  -6,582
  -7,271
  -7,969
  -8,673
  -9,383
  -10,098
  -10,818
  -11,545
  -12,281
  -13,028
  -13,788
  -14,565
  -15,361
  -16,179
  -17,024
  -17,897
Free cash flow, $m
  -153
  -268
  -300
  -332
  -356
  -366
  -351
  -303
  -207
  -53
  171
  477
  874
  1,370
  1,971
  2,681
  3,503
  4,437
  5,483
  6,639
  7,903
  9,271
  10,740
  12,308
  13,970
  15,725
  17,569
  19,502
  21,522
  23,628
  25,822
Issuance/(repayment) of debt, $m
  -58
  212
  307
  431
  585
  772
  992
  1,243
  1,524
  1,830
  2,158
  2,502
  2,858
  3,220
  3,585
  3,948
  4,308
  4,661
  5,006
  5,344
  5,673
  5,995
  6,311
  6,623
  6,931
  7,239
  7,547
  7,859
  8,177
  8,502
  8,836
Issuance/(repurchase) of shares, $m
  189
  173
  162
  138
  93
  19
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  146
  385
  469
  569
  678
  791
  992
  1,243
  1,524
  1,830
  2,158
  2,502
  2,858
  3,220
  3,585
  3,948
  4,308
  4,661
  5,006
  5,344
  5,673
  5,995
  6,311
  6,623
  6,931
  7,239
  7,547
  7,859
  8,177
  8,502
  8,836
Total cash flow (excl. dividends), $m
  -7
  117
  169
  237
  322
  425
  640
  941
  1,317
  1,777
  2,329
  2,979
  3,732
  4,590
  5,556
  6,629
  7,810
  9,098
  10,489
  11,983
  13,576
  15,266
  17,052
  18,930
  20,901
  22,963
  25,116
  27,361
  29,698
  32,130
  34,658
Retained Cash Flow (-), $m
  -166
  -178
  -258
  -361
  -490
  -647
  -831
  -1,042
  -1,277
  -1,534
  -1,809
  -2,097
  -2,396
  -2,699
  -3,005
  -3,310
  -3,611
  -3,907
  -4,197
  -4,479
  -4,756
  -5,026
  -5,290
  -5,551
  -5,810
  -6,068
  -6,327
  -6,588
  -6,854
  -7,126
  -7,407
Prev. year cash balance distribution, $m
 
  2
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  -59
  -88
  -124
  -168
  -222
  -191
  -101
  39
  243
  520
  882
  1,336
  1,891
  2,551
  3,319
  4,199
  5,191
  6,293
  7,503
  8,820
  10,241
  11,761
  13,379
  15,091
  16,896
  18,790
  20,773
  22,844
  25,004
  27,251
Discount rate, %
 
  8.70
  9.14
  9.59
  10.07
  10.57
  11.10
  11.66
  12.24
  12.85
  13.50
  14.17
  14.88
  15.62
  16.41
  17.23
  18.09
  18.99
  19.94
  20.94
  21.98
  23.08
  24.24
  25.45
  26.72
  28.06
  29.46
  30.93
  32.48
  34.11
  35.81
PV of cash for distribution, $m
 
  -55
  -74
  -94
  -115
  -134
  -102
  -47
  16
  82
  147
  205
  253
  286
  304
  306
  294
  270
  238
  203
  166
  131
  99
  73
  51
  35
  23
  14
  9
  5
  3
Current shareholders' claim on cash, %
  100
  76.7
  65.1
  59.3
  56.7
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4
  56.4

Hi-Crush Partners LP produces, transports, markets, and distributes monocrystalline sand in the United States. The monocrystalline sand is a mineral that is used as a proppant to enhance the recovery rates of hydrocarbons from oil and natural gas wells. It owns, operates, and develops sand reserves, and excavation and processing facilities, which include 1,447-acre facility with integrated rail infrastructure, located near Independence, Wisconsin, and Whitehall, Wisconsin; 971-acre facility with integrated rail infrastructure, located in Wyeville, Wisconsin; the Augusta facility situated in Eau Claire County, Wisconsin; and the Blair facility. The company offers raw frac sand used in hydraulic fracturing operations for oil and natural gas wells. It primarily serves pressure pumping service providers. Hi-Crush GP LLC operates as the general partner of the company. Hi-Crush Partners LP was founded in 2012 and is based in Houston, Texas.

FINANCIAL RATIOS  of  Hi-Crush Partners (HCLP)

Valuation Ratios
P/E Ratio -7.3
Price to Sales 2.9
Price to Book 2
Price to Tangible Book
Price to Cash Flow -21.9
Price to Free Cash Flow -8.5
Growth Rates
Sales Growth Rate -40%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -64.5%
Cap. Spend. - 3 Yr. Gr. Rate 31.3%
Financial Strength
Quick Ratio 2
Current Ratio 0
LT Debt to Equity 64.3%
Total Debt to Equity 65.3%
Interest Coverage -6
Management Effectiveness
Return On Assets -11.7%
Ret/ On Assets - 3 Yr. Avg. 9.8%
Return On Total Capital -18.4%
Ret/ On T. Cap. - 3 Yr. Avg. 8.5%
Return On Equity -37.3%
Return On Equity - 3 Yr. Avg. 18.5%
Asset Turnover 0.3
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 21.5%
EBITDA Margin -26%
EBITDA Margin - 3 Yr. Avg. 9.2%
Operating Margin -33.3%
Oper. Margin - 3 Yr. Avg. 4.4%
Pre-Tax Margin -39.7%
Pre-Tax Margin - 3 Yr. Avg. -0%
Net Profit Margin -39.7%
Net Profit Margin - 3 Yr. Avg. -0.1%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

HCLP stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the HCLP stock intrinsic value calculation we used $204 million for the last fiscal year's total revenue generated by Hi-Crush Partners. The default revenue input number comes from 2016 income statement of Hi-Crush Partners. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our HCLP stock valuation model: a) initial revenue growth rate of 59.6% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 8.7%, whose default value for HCLP is calculated based on our internal credit rating of Hi-Crush Partners, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Hi-Crush Partners.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of HCLP stock the variable cost ratio is equal to 20.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $236 million in the base year in the intrinsic value calculation for HCLP stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4.9% for Hi-Crush Partners.

Corporate tax rate of 27% is the nominal tax rate for Hi-Crush Partners. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the HCLP stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for HCLP are equal to 242.9%.

Life of production assets of 29.1 years is the average useful life of capital assets used in Hi-Crush Partners operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for HCLP is equal to -10%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $300 million for Hi-Crush Partners - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 61.582 million for Hi-Crush Partners is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Hi-Crush Partners at the current share price and the inputted number of shares is $0.6 billion.

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COMPANY NEWS

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▶ Hi-Crush Is Misunderstood and Neglected   [07:00AM  Morningstar]
▶ Oil Prices Set To Rise On Back Of OPEC Deal Extension   [May-16-17 02:30PM  Oilprice.com]
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▶ Mizuho Initiated Coverage on Hi-Crush Partners with a Buy   [May-11-17 01:23PM  Market Realist]
▶ Which MLP Stocks Were the Biggest Losers in April 2017?   [May-05-17 04:34PM  Market Realist]
▶ Hi-Crush Partners LP Reports First Quarter 2017 Results   [May-01-17 05:08PM  GlobeNewswire]
▶ Houston frac sand co. to mine popular West Texas destination   [Mar-16-17 04:20PM  at bizjournals.com]
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▶ Trumpcare Won't Make Health Insurers Sick   [12:19PM  at The Wall Street Journal]
▶ Shares of Hi-Crush Partners Get Crushed After Share Issuance   [Feb-24-17 01:08PM  at Motley Fool]
Stock chart of HCLP Financial statements of HCLP Annual reports of HCLP
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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