Intrinsic value of U.S. Silica Holdings - SLCA

Previous Close

$23.76

  Intrinsic Value

$135.07

stock screener

  Rating & Target

str. buy

+468%

Previous close

$23.76

 
Intrinsic value

$135.07

 
Up/down potential

+468%

 
Rating

str. buy

We calculate the intrinsic value of SLCA 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 2017), $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 1.9

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   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
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  1,986
  3,068
  4,588
  6,657
  9,392
  12,911
  17,331
  22,756
  29,282
  36,986
  45,928
  56,151
  67,681
  80,527
  94,685
  110,142
  126,874
  144,855
  164,056
  184,448
  206,003
  228,701
  252,523
  277,459
  303,504
  330,663
  358,947
  388,374
  418,971
  450,774
Variable operating expenses, $m
  1,313
  2,006
  2,978
  4,302
  6,053
  8,305
  11,134
  14,606
  18,783
  23,713
  29,393
  35,936
  43,315
  51,537
  60,598
  70,490
  81,199
  92,707
  104,995
  118,046
  131,841
  146,367
  161,613
  177,572
  194,241
  211,623
  229,724
  248,557
  268,140
  288,493
Fixed operating expenses, $m
  246
  252
  257
  263
  269
  275
  281
  287
  293
  300
  306
  313
  320
  327
  334
  341
  349
  357
  364
  372
  381
  389
  398
  406
  415
  424
  434
  443
  453
  463
Total operating expenses, $m
  1,559
  2,258
  3,235
  4,565
  6,322
  8,580
  11,415
  14,893
  19,076
  24,013
  29,699
  36,249
  43,635
  51,864
  60,932
  70,831
  81,548
  93,064
  105,359
  118,418
  132,222
  146,756
  162,011
  177,978
  194,656
  212,047
  230,158
  249,000
  268,593
  288,956
Operating income, $m
  426
  810
  1,352
  2,091
  3,070
  4,331
  5,916
  7,863
  10,206
  12,973
  16,228
  19,902
  24,046
  28,663
  33,753
  39,310
  45,326
  51,792
  58,697
  66,030
  73,782
  81,944
  90,512
  99,480
  108,848
  118,616
  128,789
  139,373
  150,379
  161,818
EBITDA, $m
  689
  1,194
  1,904
  2,873
  4,156
  5,808
  7,884
  10,434
  13,502
  17,124
  21,331
  26,140
  31,565
  37,610
  44,273
  51,547
  59,422
  67,885
  76,923
  86,522
  96,669
  107,353
  118,567
  130,306
  142,567
  155,353
  168,668
  182,522
  196,926
  211,899
Interest expense (income), $m
  22
  31
  64
  112
  180
  272
  394
  550
  747
  989
  1,279
  1,622
  2,020
  2,475
  2,989
  3,560
  4,191
  4,879
  5,624
  6,424
  7,279
  8,187
  9,146
  10,157
  11,217
  12,327
  13,487
  14,696
  15,955
  17,265
  18,627
Earnings before tax, $m
  395
  746
  1,240
  1,911
  2,798
  3,938
  5,366
  7,116
  9,218
  11,694
  14,606
  17,881
  21,570
  25,675
  30,193
  35,119
  40,448
  46,168
  52,272
  58,751
  65,595
  72,798
  80,355
  88,263
  96,521
  105,129
  114,093
  123,419
  133,114
  143,191
Tax expense, $m
  107
  202
  335
  516
  755
  1,063
  1,449
  1,921
  2,489
  3,157
  3,944
  4,828
  5,824
  6,932
  8,152
  9,482
  10,921
  12,465
  14,114
  15,863
  17,711
  19,656
  21,696
  23,831
  26,061
  28,385
  30,805
  33,323
  35,941
  38,662
Net income, $m
  289
  545
  905
  1,395
  2,043
  2,874
  3,917
  5,195
  6,729
  8,537
  10,662
  13,053
  15,746
  18,742
  22,041
  25,637
  29,527
  33,703
  38,159
  42,888
  47,884
  53,143
  58,659
  64,432
  70,460
  76,744
  83,288
  90,096
  97,173
  104,529

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $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
Total assets, $m
  3,418
  5,280
  7,896
  11,457
  16,165
  22,223
  29,829
  39,168
  50,399
  63,658
  79,049
  96,645
  116,490
  138,600
  162,969
  189,572
  218,372
  249,320
  282,368
  317,466
  354,567
  393,633
  434,635
  477,554
  522,382
  569,127
  617,808
  668,457
  721,121
  775,859
Adjusted assets (=assets-cash), $m
  3,418
  5,280
  7,896
  11,457
  16,165
  22,223
  29,829
  39,168
  50,399
  63,658
  79,049
  96,645
  116,490
  138,600
  162,969
  189,572
  218,372
  249,320
  282,368
  317,466
  354,567
  393,633
  434,635
  477,554
  522,382
  569,127
  617,808
  668,457
  721,121
  775,859
Revenue / Adjusted assets
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
  0.581
Average production assets, $m
  2,206
  3,408
  5,097
  7,396
  10,434
  14,345
  19,255
  25,282
  32,532
  41,091
  51,026
  62,384
  75,193
  89,465
  105,195
  122,367
  140,957
  160,934
  182,266
  204,921
  228,870
  254,087
  280,553
  308,257
  337,193
  367,367
  398,790
  431,483
  465,477
  500,810
Working capital, $m
  -89
  -138
  -206
  -300
  -423
  -581
  -780
  -1,024
  -1,318
  -1,664
  -2,067
  -2,527
  -3,046
  -3,624
  -4,261
  -4,956
  -5,709
  -6,518
  -7,383
  -8,300
  -9,270
  -10,292
  -11,364
  -12,486
  -13,658
  -14,880
  -16,153
  -17,477
  -18,854
  -20,285
Total debt, $m
  1,051
  1,840
  2,950
  4,460
  6,455
  9,024
  12,249
  16,209
  20,971
  26,593
  33,119
  40,579
  48,993
  58,368
  68,701
  79,980
  92,191
  105,313
  119,326
  134,207
  149,938
  166,502
  183,887
  202,084
  221,092
  240,912
  261,552
  283,028
  305,357
  328,566
Total liabilities, $m
  1,449
  2,239
  3,348
  4,858
  6,854
  9,422
  12,648
  16,607
  21,369
  26,991
  33,517
  40,978
  49,392
  58,767
  69,099
  80,379
  92,590
  105,712
  119,724
  134,605
  150,336
  166,900
  184,285
  202,483
  221,490
  241,310
  261,951
  283,426
  305,755
  328,964
Total equity, $m
  1,969
  3,041
  4,548
  6,599
  9,311
  12,800
  17,182
  22,561
  29,030
  36,667
  45,532
  55,668
  67,098
  79,834
  93,870
  109,194
  125,782
  143,608
  162,644
  182,860
  204,231
  226,733
  250,350
  275,071
  300,892
  327,817
  355,857
  385,032
  415,366
  446,895
Total liabilities and equity, $m
  3,418
  5,280
  7,896
  11,457
  16,165
  22,222
  29,830
  39,168
  50,399
  63,658
  79,049
  96,646
  116,490
  138,601
  162,969
  189,573
  218,372
  249,320
  282,368
  317,465
  354,567
  393,633
  434,635
  477,554
  522,382
  569,127
  617,808
  668,458
  721,121
  775,859
Debt-to-equity ratio
  0.530
  0.610
  0.650
  0.680
  0.690
  0.700
  0.710
  0.720
  0.720
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.730
  0.740
  0.740
  0.740
Adjusted equity ratio
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576
  0.576

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  289
  545
  905
  1,395
  2,043
  2,874
  3,917
  5,195
  6,729
  8,537
  10,662
  13,053
  15,746
  18,742
  22,041
  25,637
  29,527
  33,703
  38,159
  42,888
  47,884
  53,143
  58,659
  64,432
  70,460
  76,744
  83,288
  90,096
  97,173
  104,529
Depreciation, amort., depletion, $m
  263
  383
  552
  782
  1,086
  1,477
  1,968
  2,570
  3,295
  4,151
  5,103
  6,238
  7,519
  8,947
  10,520
  12,237
  14,096
  16,093
  18,227
  20,492
  22,887
  25,409
  28,055
  30,826
  33,719
  36,737
  39,879
  43,148
  46,548
  50,081
Funds from operations, $m
  551
  928
  1,457
  2,177
  3,128
  4,351
  5,885
  7,765
  10,024
  12,688
  15,765
  19,292
  23,266
  27,689
  32,560
  37,874
  43,622
  49,796
  56,385
  63,380
  70,771
  78,551
  86,715
  95,258
  104,179
  113,481
  123,167
  133,244
  143,721
  154,610
Change in working capital, $m
  -34
  -49
  -68
  -93
  -123
  -158
  -199
  -244
  -294
  -347
  -402
  -460
  -519
  -578
  -637
  -696
  -753
  -809
  -864
  -918
  -970
  -1,021
  -1,072
  -1,122
  -1,172
  -1,222
  -1,273
  -1,324
  -1,377
  -1,431
Cash from operations, $m
  585
  977
  1,525
  2,270
  3,251
  4,509
  6,084
  8,009
  10,318
  13,035
  16,167
  19,752
  23,784
  28,267
  33,197
  38,569
  44,375
  50,605
  57,249
  64,298
  71,741
  79,573
  87,787
  96,380
  105,351
  114,703
  124,440
  134,568
  145,098
  156,042
Maintenance CAPEX, $m
  -138
  -221
  -341
  -510
  -740
  -1,043
  -1,434
  -1,925
  -2,528
  -3,253
  -4,109
  -5,103
  -6,238
  -7,519
  -8,947
  -10,520
  -12,237
  -14,096
  -16,093
  -18,227
  -20,492
  -22,887
  -25,409
  -28,055
  -30,826
  -33,719
  -36,737
  -39,879
  -43,148
  -46,548
New CAPEX, $m
  -828
  -1,202
  -1,689
  -2,299
  -3,039
  -3,910
  -4,910
  -6,028
  -7,250
  -8,559
  -9,935
  -11,358
  -12,810
  -14,272
  -15,730
  -17,172
  -18,590
  -19,977
  -21,332
  -22,655
  -23,949
  -25,217
  -26,466
  -27,704
  -28,937
  -30,174
  -31,423
  -32,694
  -33,994
  -35,332
Cash from investing activities, $m
  -966
  -1,423
  -2,030
  -2,809
  -3,779
  -4,953
  -6,344
  -7,953
  -9,778
  -11,812
  -14,044
  -16,461
  -19,048
  -21,791
  -24,677
  -27,692
  -30,827
  -34,073
  -37,425
  -40,882
  -44,441
  -48,104
  -51,875
  -55,759
  -59,763
  -63,893
  -68,160
  -72,573
  -77,142
  -81,880
Free cash flow, $m
  -381
  -446
  -504
  -538
  -527
  -444
  -261
  56
  540
  1,223
  2,123
  3,291
  4,736
  6,476
  8,521
  10,878
  13,549
  16,533
  19,824
  23,416
  27,301
  31,469
  35,912
  40,621
  45,589
  50,810
  56,280
  61,995
  67,956
  74,161
Issuance/(repayment) of debt, $m
  544
  790
  1,109
  1,510
  1,996
  2,569
  3,225
  3,960
  4,762
  5,622
  6,526
  7,461
  8,414
  9,375
  10,332
  11,280
  12,211
  13,122
  14,012
  14,881
  15,731
  16,564
  17,385
  18,197
  19,007
  19,820
  20,641
  21,475
  22,329
  23,209
Issuance/(repurchase) of shares, $m
  448
  528
  602
  656
  669
  615
  464
  184
  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  
  992
  1,318
  1,711
  2,166
  2,665
  3,184
  3,689
  4,144
  4,762
  5,622
  6,526
  7,461
  8,414
  9,375
  10,332
  11,280
  12,211
  13,122
  14,012
  14,881
  15,731
  16,564
  17,385
  18,197
  19,007
  19,820
  20,641
  21,475
  22,329
  23,209
Total cash flow (excl. dividends), $m
  612
  871
  1,207
  1,628
  2,138
  2,739
  3,429
  4,200
  5,302
  6,845
  8,649
  10,752
  13,151
  15,851
  18,853
  22,158
  25,760
  29,655
  33,836
  38,297
  43,032
  48,033
  53,296
  58,818
  64,597
  70,630
  76,921
  83,471
  90,285
  97,370
Retained Cash Flow (-), $m
  -737
  -1,073
  -1,507
  -2,051
  -2,711
  -3,489
  -4,381
  -5,379
  -6,469
  -7,637
  -8,865
  -10,135
  -11,431
  -12,735
  -14,037
  -15,323
  -16,588
  -17,826
  -19,036
  -20,216
  -21,370
  -22,502
  -23,617
  -24,721
  -25,821
  -26,925
  -28,040
  -29,174
  -30,334
  -31,529
Prev. year cash balance distribution, $m
  165
  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
  25
  40
  61
  92
  133
  188
  258
  347
  455
  586
  740
  919
  1,123
  1,354
  1,611
  1,894
  2,203
  2,537
  2,897
  3,281
  3,689
  4,120
  4,574
  5,050
  5,549
  6,070
  6,613
  7,179
  7,767
  8,379
Cash available for distribution, $m
  40
  -201
  -300
  -424
  -573
  -750
  -953
  -1,179
  -1,167
  -793
  -216
  617
  1,720
  3,115
  4,817
  6,834
  9,172
  11,828
  14,801
  18,081
  21,661
  25,531
  29,679
  34,097
  38,775
  43,705
  48,881
  54,297
  59,951
  65,841
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  38
  -184
  -261
  -349
  -445
  -544
  -644
  -737
  -671
  -416
  -103
  263
  654
  1,046
  1,414
  1,737
  1,996
  2,178
  2,279
  2,298
  2,240
  2,118
  1,945
  1,737
  1,508
  1,275
  1,049
  840
  654
  496
Current shareholders' claim on cash, %
  79.1
  66.2
  57.9
  52.4
  48.8
  46.6
  45.4
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0
  45.0

U.S. Silica Holdings, Inc. is a domestic producer of commercial silica, a specialized mineral that is an input into a range of end markets. The Company operates in two segments: Oil & Gas Proppants, and Industrial & Specialty Products. In the Oil & Gas Proppants segment, it serves the oil and gas recovery market providing fracturing sand, or frac sand, which is pumped down oil and natural gas wells to prop open rock fissures and manage the flow rate of natural gas and oil from the wells. As of December 31, 2016, the Industrial & Specialty Products segment consisted of over 215 products and materials, which are used in a range of industries, including container glass, fiberglass, specialty glass, flat glass, building products, fillers and extenders, foundry products, chemicals, recreation products and filtration products. It produces and sells a range of commercial silica products, including whole grain and ground products, as well as other industrial mineral products.

FINANCIAL RATIOS  of  U.S. Silica Holdings (SLCA)

Valuation Ratios
P/E Ratio -47
Price to Sales 3.4
Price to Book 1.5
Price to Tangible Book
Price to Cash Flow 0
Price to Free Cash Flow -41
Growth Rates
Sales Growth Rate -12.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -13%
Cap. Spend. - 3 Yr. Gr. Rate -4.8%
Financial Strength
Quick Ratio 102
Current Ratio 0
LT Debt to Equity 40%
Total Debt to Equity 40.5%
Interest Coverage -3
Management Effectiveness
Return On Assets -1.9%
Ret/ On Assets - 3 Yr. Avg. 4.6%
Return On Total Capital -3.1%
Ret/ On T. Cap. - 3 Yr. Avg. 4.6%
Return On Equity -4.9%
Return On Equity - 3 Yr. Avg. 10.8%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 14.6%
Gross Margin - 3 Yr. Avg. 24.3%
EBITDA Margin 2.1%
EBITDA Margin - 3 Yr. Avg. 13.2%
Operating Margin -9.5%
Oper. Margin - 3 Yr. Avg. 4.9%
Pre-Tax Margin -13.9%
Pre-Tax Margin - 3 Yr. Avg. 1.4%
Net Profit Margin -7.3%
Net Profit Margin - 3 Yr. Avg. 2.8%
Effective Tax Rate 47.4%
Eff/ Tax Rate - 3 Yr. Avg. 23.6%
Payout Ratio -36.6%

SLCA stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SLCA stock intrinsic value calculation we used $1241 million for the last fiscal year's total revenue generated by U.S. Silica Holdings. The default revenue input number comes from 2017 income statement of U.S. Silica Holdings. 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 SLCA stock valuation model: a) initial revenue growth rate of 60% 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 4.3%, whose default value for SLCA is calculated based on our internal credit rating of U.S. Silica Holdings, 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 U.S. Silica Holdings.
    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 SLCA stock the variable cost ratio is equal to 67.4%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $241 million in the base year in the intrinsic value calculation for SLCA 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 6.1% for U.S. Silica Holdings.

Corporate tax rate of 27% is the nominal tax rate for U.S. Silica Holdings. 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 SLCA stock is equal to 2%.

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 SLCA are equal to 111.1%.

Life of production assets of 10 years is the average useful life of capital assets used in U.S. Silica Holdings 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 SLCA is equal to -4.5%. 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 - $1397 million for U.S. Silica Holdings - 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 81 million for U.S. Silica Holdings 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 U.S. Silica Holdings at the current share price and the inputted number of shares is $1.9 billion.

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COMPANY NEWS

▶ Silica Holdings: 2Q Earnings Snapshot   [08:25AM  Associated Press]
▶ The Permian Rush Is Creating A Frac Sand Shortage   [Jul-18-18 04:00PM  Oilprice.com]
▶ U.S. Silica Declares Quarterly Dividend   [Jul-16-18 09:00AM  PR Newswire]
▶ 3 Top Stocks On Sale This Quarter   [Jul-07-18 08:47AM  Motley Fool]
▶ Demand for Frac Sand and Concrete Drives Scarcity   [Jul-05-18 03:21PM  Investopedia]
▶ Biotech and energy top list for best paying jobs   [May-25-18 01:46PM  Yahoo Finance Video]
▶ Exploring for Summer Profits in Energy   [May-23-18 02:30PM  Investopedia]
▶ 3 Top Energy Stocks to Buy in May   [May-15-18 09:32PM  Motley Fool]
▶ U.S. Silica Provides Update On Capital Allocation Plan   [May-14-18 09:00AM  PR Newswire]
▶ U.S. Silica Completes Acquisition of EP Minerals   [May-01-18 09:00AM  PR Newswire]
▶ Intel, Zimmer Holdings, US Silica Holdings & Square   [Apr-27-18 01:49PM  CNBC Videos]
▶ Silica Holdings: 1Q Earnings Snapshot   [06:15AM  Associated Press]
▶ Trade of the Day: U.S. Silica Holdings (SLCA)   [Apr-18-18 09:10AM  InvestorPlace]
▶ Is U.S. Silica Holdings a Buy?   [Apr-10-18 07:20AM  Motley Fool]
▶ Wired News US Silica Purchases EP Minerals   [Mar-27-18 07:20AM  ACCESSWIRE]
▶ [$$] U.S. Silica to Buy EP Minerals for $750 Million   [06:18AM  The Wall Street Journal]
▶ EP Minerals to be Acquired by U.S. Silica   [05:30AM  Business Wire]
▶ 3 Stocks That Are Absurdly Cheap Right Now   [Mar-10-18 03:10PM  Motley Fool]
▶ Insiders Are Frantically Buying Up These Cheap Stocks   [Feb-27-18 03:38PM  Insider Monkey]
▶ Silica Holdings misses 4Q profit forecasts   [06:20AM  Associated Press]
▶ U.S. Silica Declares Quarterly Dividend   [Feb-20-18 09:00AM  PR Newswire]
▶ T. Boone Pickens' Top 4 New Buys   [Feb-14-18 03:46PM  GuruFocus.com]
▶ U.S. Silica Has Turned Up, Breaking a Downtrend Line   [Jan-23-18 03:21PM  TheStreet.com]
▶ 5 Top Trades With Oil Prices in Full Rally Mode   [Jan-04-18 12:00PM  TheStreet.com]
▶ The 5th-Lowest Oilfield Services FCF Earner in 3Q17   [Dec-28-17 02:15PM  Market Realist]
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