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Mammoth Energy Surges After-Hours on $30 Million Subsidiary Sale

MarketDash Editorial Team
5 days ago
Mammoth Energy Services saw its stock jump over 7% in after-hours trading Tuesday following the announcement of a $30 million sale of its Aquawolf engineering subsidiary, with management arguing the deal highlights hidden value in the company.

Mammoth Energy Services Inc. (TUSK) got a nice after-hours bump Tuesday, with shares climbing 7.65% to $1.90 after the company announced it's cashing out of its engineering business for $30 million. The stock had closed regular trading at $1.76, down slightly for the day.

Selling What They Built

The Oklahoma City-based energy services company completed the sale of all equity interests in its Aquawolf LLC subsidiary to Qualus LLC, pocketing a solid return on what started as a modest investment back in 2018. Mammoth Energy Partners LLC received $23.5 million in cash upfront, with another $2.5 million sitting in escrow for at least 90 days to handle any post-closing adjustments and potential liabilities through December 2026.

Through September, Aquawolf had recorded $12 million in revenue and $1.3 million in net income, showing the business was actually profitable and not just some side project.

Management Makes Its Case

Chief Financial Officer Mark Layton seemed pretty pleased with how this turned out. He pointed out that the company "entered the Engineering business in 2018 with one manager and a small initial investment, and over time built it into a team generating $17.3 million of revenue in 2024."

More importantly, Layton argued the sale "reinforces our belief that the underlying value across Mammoth is significantly disconnected from the current share price." Translation: We just proved we can create value, so maybe the market should give us more credit.

Banking Details Sorted

Fifth Third Bank, National Association, gave its blessing to the transaction and released the associated collateral through a consent and release agreement. The company's borrowing base stays unchanged, so this was a clean exit without complicating the capital structure.

The Bigger Picture

Despite Tuesday's after-hours pop, TUSK shares are still down 40.77% year-to-date. The company carries a market capitalization of $85.06 million and has traded between $1.68 and $3.52 over the past 52 weeks. The stock has been showing negative price momentum across all time frames, making this asset sale and the resulting share price reaction a bright spot in an otherwise rough year for shareholders.

Back to News

Mammoth Energy Surges After-Hours on $30 Million Subsidiary Sale

MarketDash Editorial Team
5 days ago
Mammoth Energy Services saw its stock jump over 7% in after-hours trading Tuesday following the announcement of a $30 million sale of its Aquawolf engineering subsidiary, with management arguing the deal highlights hidden value in the company.

Mammoth Energy Services Inc. (TUSK) got a nice after-hours bump Tuesday, with shares climbing 7.65% to $1.90 after the company announced it's cashing out of its engineering business for $30 million. The stock had closed regular trading at $1.76, down slightly for the day.

Selling What They Built

The Oklahoma City-based energy services company completed the sale of all equity interests in its Aquawolf LLC subsidiary to Qualus LLC, pocketing a solid return on what started as a modest investment back in 2018. Mammoth Energy Partners LLC received $23.5 million in cash upfront, with another $2.5 million sitting in escrow for at least 90 days to handle any post-closing adjustments and potential liabilities through December 2026.

Through September, Aquawolf had recorded $12 million in revenue and $1.3 million in net income, showing the business was actually profitable and not just some side project.

Management Makes Its Case

Chief Financial Officer Mark Layton seemed pretty pleased with how this turned out. He pointed out that the company "entered the Engineering business in 2018 with one manager and a small initial investment, and over time built it into a team generating $17.3 million of revenue in 2024."

More importantly, Layton argued the sale "reinforces our belief that the underlying value across Mammoth is significantly disconnected from the current share price." Translation: We just proved we can create value, so maybe the market should give us more credit.

Banking Details Sorted

Fifth Third Bank, National Association, gave its blessing to the transaction and released the associated collateral through a consent and release agreement. The company's borrowing base stays unchanged, so this was a clean exit without complicating the capital structure.

The Bigger Picture

Despite Tuesday's after-hours pop, TUSK shares are still down 40.77% year-to-date. The company carries a market capitalization of $85.06 million and has traded between $1.68 and $3.52 over the past 52 weeks. The stock has been showing negative price momentum across all time frames, making this asset sale and the resulting share price reaction a bright spot in an otherwise rough year for shareholders.