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What: Emerge Energy Services LP (NYSE: EMES) is giving back some of its recent gains today, with its units down 11% by 2:45 p.m. EDT on Monday. Fueling the selling was an analyst downgrade, which said units have run up too far, too fast after doubling last week.

So what: D.A. Davidson downgraded units of Emerge Energy Services from buy to underperform, though it left its price target unchanged at $5. That's after Emerge Energy Services' recent surge had it trading "well ahead of fundamentals for a growing industry that is still in flux."

In fact, D.A. Davidson views the recent surge in valuations among frack sand producers in general as being "devoid of reality," which is why it also downgraded U.S. Silica Holdings (NYSE:SLCA), Hi-Crush Partners (OTC:HCRS.Q), and Fairmount Santrol Holdings (NYSE: FMSA). Both U.S. Silica and Hi-Crush Partners were cut from buy to neutral, while Fairmount Santrol was reduced from buy to underperform. In doing so, D.A. Davidson cited its concern that there might not be a normalization for the industry, which could lead to compressed multiples for the group.

Now what: Frack sand producers have run up in recent weeks, thanks to crude's rally to around $50 a barrel. However, that run might have been a bit much, given that it could still be a while before producers start bringing drilling rigs back online. That will likely keep a lid on frack sand volumes and margins, likely limiting the near-term growth potential for frack sand producers.

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