Financial Survey: Smart Sand (SND) and Forterra (FRTA)

Smart Sand (NASDAQ: SND) and Forterra (NASDAQ:FRTA) are both small-cap basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, analyst recommendations, profitability, earnings and risk.

Analyst Ratings

This is a breakdown of current ratings for Smart Sand and Forterra, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Smart Sand 0 5 5 0 2.50
Forterra 0 4 2 0 2.33

Smart Sand presently has a consensus price target of $13.45, indicating a potential upside of 49.44%. Forterra has a consensus price target of $11.83, indicating a potential upside of 1.49%. Given Smart Sand’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Smart Sand is more favorable than Forterra.

Insider and Institutional Ownership

49.5% of Smart Sand shares are held by institutional investors. Comparatively, 99.9% of Forterra shares are held by institutional investors. 46.4% of Smart Sand shares are held by company insiders. Comparatively, 0.3% of Forterra shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Smart Sand and Forterra’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Smart Sand 18.67% 14.41% 11.85%
Forterra -5.97% -69.57% -4.00%

Earnings and Valuation

This table compares Smart Sand and Forterra’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Smart Sand $59.23 million 6.14 $10.37 million $0.66 13.64
Forterra $1.36 billion 0.55 -$7.60 million N/A N/A

Smart Sand has higher earnings, but lower revenue than Forterra.

Summary

Smart Sand beats Forterra on 9 of the 11 factors compared between the two stocks.

About Smart Sand

Smart Sand, Inc. is a producer of Northern White raw frac sand, which is a proppant used to enhance hydrocarbon recovery rates in the hydraulic fracturing of oil and natural gas wells. The Company sells its products primarily to oil and natural gas exploration and production companies and oilfield service companies under a combination of long-term take-or-pay contracts and spot sales in the open market. It owns and operates a raw frac sand mine and related processing facility near Oakdale, Wisconsin. In addition to the Oakdale facility, it owns a second property in Jackson County, Wisconsin, known as Hixton site. Its sand reserves include a balanced concentration of coarse (20/40, 30/50 and 40/70 gradation) sands and fine (60/140 gradation) sand. Its reserves contain deposits of approximately 20% of 20/40 and coarser substrate, over 40% of 40/70 mesh substrate and approximately 40% of 100-mesh substrate. Its 30/50 gradation is a derivative of the 20/40 and 40/70 blends.

About Forterra

Forterra, Inc. is a manufacturer of pipe and precast products. The Company offers products for a range of water-related infrastructure applications, including water transmission, distribution and drainage. The Company operates approximately 95 facilities. Its products are available in the United States and Eastern Canada.

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