AESI

Atlas Energy Solutions($AESI) Executive Buys $394K in Shares Despite Stock Plunge and Earnings Disappointment

05/13/2025 21:07

An executive at Atlas Energy Solutions ($AESI), a provider of fracking sand for oil and gas companies, has made substantial stock purchases following recent sharp declines in the company's share price. This insider buying comes as the company grapples with significant earnings disappointments and stock depreciation. Over two days, May 12 and 13, 2025, Atlas Energy executive Ben Brigham acquired a total of 29,521 shares worth approximately $394,000. Specifically, he purchased 20,400 shares at an average price of $13.32 ($271,685) on May 12, followed by an additional 9,121 shares at an average of $13.36 ($121,873) on May 13. This buying activity occurred after the stock had fallen about 40% year-to-date, making it notable as executive purchases often signal an insider's belief that shares are undervalued. Based in Austin, Texas, Atlas Energy Solutions supplies fracking sand and related logistics services to oil and natural gas exploration and production companies primarily operating in the Permian Basin of West Texas and New Mexico. This region represents a major shale oil production area in the United States, tying the company's fortunes closely to oil and gas drilling activity. The insider purchases came shortly after Atlas Energy reported first-quarter 2025 results on May 5 that fell significantly short of expectations. The company posted adjusted earnings of just 1 cent per share, far below analysts' expectations of 16 cents and down from 26 cents in the same quarter last year. Notably, net income plummeted 95% year-over-year to just $1.22 million. However, revenue increased by 54.5% to $297.59 million, exceeding the forecast of $290.07 million. This suggests that while sales volumes grew, profitability deteriorated substantially. The company reported adjusted EBITDA of $74.3 million, representing a 25% margin, and adjusted free cash flow of $58.8 million (20% margin). Examining insider trading patterns at Atlas Energy over recent years reveals interesting trends. Major shareholder Gregory Shepard consistently purchased shares between June and November 2024, often increasing his buying during price dips. Conversely, major shareholder Brian Leveille steadily sold shares from October 2024 through January 2025 as prices rose. Meanwhile, Stacy Hock has maintained regular small-scale selling. In February this year, Ben Brigham made another significant purchase, acquiring 217,391 shares at $23 per share for approximately $5 million. Combined with his May purchases, Brigham has invested roughly $5.4 million in company stock this year alone. Atlas Energy Solutions announced a partnership earlier this year with autonomous trucking technology company Kodiak Robotics to improve transportation efficiency and reduce costs. Interestingly, Kodiak recently announced plans to go public through a SPAC merger valuing the company at $2.5 billion. This partnership holds potential to enhance Atlas's logistics capabilities and improve operational efficiency. Additionally, the company conducted a share offering earlier this year to raise approximately $264.5 million to fund the acquisition of Moser Energy Systems. This acquisition represents part of the company's strategy to diversify its service portfolio through renewable natural gas power generation solutions. Industry experts note that the fracking sand market is closely tied to volatility in oil and gas drilling activity. In recent months, falling crude oil prices have led to reduced capital expenditures by energy companies and some project deferrals, putting pressure on service providers like Atlas. Atlas Energy's stock currently trades at $13.23, down approximately 51% from its 52-week high of $26.86, with a market capitalization of about $1.8 billion. Analysts' average price target stands at $20, suggesting an upside potential of about 51% from current levels. Most analysts still maintain a 'buy' rating, though earnings estimates have been revised downward following recent performance disappointments. Going forward, Atlas Energy's performance will largely depend on oil and gas activity levels in the Permian Basin, the company's ability to manage costs, and successful execution of new strategic initiatives. Whether Ben Brigham's substantial stock purchases represent a positive signal of insider confidence in the company's value or merely a temporary investment remains to be seen.

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