Atlas Energy Solutions announces 10 million share offering

AUSTIN, Texas - Atlas (NYSE:ATCO) Energy Solutions Inc. (NYSE: AESI), a leading proppant producer and logistics provider with a market capitalization of $2.76 billion, has announced the launch of an underwritten public offering of 10 million shares of common stock. The company, whose stock has delivered a remarkable 47.48% return over the past year and is currently trading near its 52-week high of $26.86, plans to use the proceeds to repay debt, fund part of the Moser Energy Systems acquisition, and for general corporate purposes. According to InvestingPro analysis, the company appears slightly undervalued based on its Fair Value metrics.

The net proceeds from the offering are earmarked for repaying certain debts, including a portion of Atlas’s secured PIK toggle seller note and outstanding borrowings under its credit and term loan facilities. The company currently operates with a moderate debt-to-equity ratio of 0.47, as reported by InvestingPro, which maintains comprehensive financial health metrics and Pro Research Reports for over 1,400 US stocks. Additionally, funds will be allocated to the cash consideration for the acquisition of Moser Energy Systems, a transaction expected to close in the first quarter of 2025, subject to standard closing conditions and regulatory approvals. The offering’s success is not a condition for the acquisition and vice versa.

Atlas Energy Solutions also anticipates providing underwriters a 30-day option to purchase up to 1.5 million additional shares of common stock at the public offering price, minus underwriting discounts and commissions.

The offering is being managed by Goldman Sachs & Co. LLC and Piper Sandler & Co. as the lead book-running managers. It is subject to market conditions, and there is no certainty regarding the completion timing, size, or terms of the offering.

Investors should note that the offering will be made through a prospectus supplement and accompanying base prospectus, part of an effective shelf registration statement filed with the U.S. Securities and Exchange Commission on May 15, 2024.

Atlas Energy Solutions, founded in 2017, is primarily focused on serving the Permian Basin of West Texas and New Mexico. The company operates 14 proppant production facilities and manages a comprehensive logistics platform, including a 42-mile conveyor system and a fleet of over 120 trucks. With an impressive revenue growth of 48.67% over the last twelve months and EBITDA of $261.94 million, Atlas prioritizes technology and innovation to enhance operational efficiency and environmental responsibility.

This press release constitutes neither an offer to sell nor a solicitation of an offer to buy securities in any jurisdiction where such an offer, solicitation, or sale would be unlawful. The information provided is based on a press release statement.

In other recent news, Atlas Energy Solutions has been making strategic acquisitions to diversify its portfolio and enhance its offerings in the power solutions sector. The company recently acquired Moser Energy Systems and Moser Acquisitions, Inc. for $220 million each, a move expected to bring significant growth potential. This development was followed by a series of price target adjustments by Benchmark, RBC Capital, Citi, and Stephens, setting targets at $28, $28, $24, and $29 respectively.

Despite these advancements, Atlas Energy received downgrades from major firms including BofA Securities, Goldman Sachs, and Citi, shifting the stock rating from Buy to Neutral due to concerns over the company’s financial forecasts. However, Atlas Energy continues to show strong financial health, with a recent 6% quarterly increase in revenue, reaching $304 million, and a dividend increase to $0.24 per share. The company also announced a $200 million share repurchase program, demonstrating confidence in its financial stability.

These are the recent developments for Atlas Energy Solutions, reflecting the company’s strategic moves and financial performance. Despite the downgrades, the company maintains strong fundamentals, with revenue reaching $925.76M and year-over-year growth of 48.67%. These developments provide investors with a clear view of Atlas Energy’s recent strategic decisions and financial health.

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