UPDATE: Goldman Sachs Initiates CARBO Ceramics with Neutral on Core Growth Drivers

In a report published Wednesday, Goldman Sachs analyst Michael Cerasoli initiated coverage on CARBO Ceramics CRR with a Neutral rating and $110.00 price target. In the report, Cerasoli noted, “We initiate coverage of CARBO (CRR) with a Neutral rating; CRR primarily manufactures ceramic proppant used to keep fractures open in oil/gas wells. While CRR benefits from an inflecting NAM land cycle, E&Ps focus on cost controls and normalizing oil/gas prices drive a preference near-term for cheaper sand over ceramics. We could turn more positive on CRR if oil/gas prices rise more than expected, as higher E&P cash flows might persuade them to use more ceramics. A gas recovery could be especially beneficial, as it could re-open certain deeper plays that have historically relied on ceramics. Our $110 12-month target implies 25% upside (group: 21%).” CARBO Ceramics closed on Tuesday at $88.41.