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Green Plains (GPRE) is Now a Strong Buy: Should You Add?
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Zacks Investment Research upgraded Green Plains Inc. (GPRE - Free Report) to a Zacks Rank #1 (Strong Buy) on Sep 13, 2016. Going by the Zacks model, companies sporting a Zacks Rank #1 have strong chances of outperforming the broader market in the near term.
Why the Upgrade?
Market sentiments have been favoring Green Plains since the beginning of 2016, as evident from the 9.9% rise in the company’s share price to date. Also, the company’s financial performance in last quarter has been impressive, with earnings of 21 cents per share surpassing the Zacks Consensus Estimate of break-even level.
Green Plains’ top line was driven by healthy results in the ethanol production, agribusiness and marketing and distribution businesses. Ethanol production in the quarter was strong, while the same is anticipated to be better in second half of 2016. Also, the company aims at a sound capital allocation policy of rewarding its shareholders handsomely through dividends and share buybacks. It also plans on investing in organic and inorganic growth opportunities.
In Aug 2016, Green Plains announced that it will be acquiring three ethanol plants, with combined production capacity of 236 million gallons per year from Abengoa Bioenergy. The transaction has been valued at $237 million, to be paid in cash, plus some working capital adjustments. Post the completion of the transaction by the end of Sep 2016, the company will own 17 dry mill ethanol facilities, with an estimated combined annual production capacity of 1.5 billion gallons.
Impressive results and outlook have made investors optimistic about Green Plains’ prospects. Over the last 60 days, the Zacks Consensus Estimate for the stock increased from loss per share of 13 cents to earnings of 21 cents for 2016, while it increased 24.1% to $1.34 per share for 2017. Also, the company has an Earnings ESP of +66.67% for 2016 and +11.94% for 2017.
Green Plains Inc. currently has a market capitalization of $962.6 million. Other stocks worth mentioning in the chemical specialty industry include NL Industries Inc. (NL - Free Report) , Ingevity Corporation (NGVT - Free Report) and Minerals Technologies Inc. (MTX - Free Report) . While NL Industries sports the same Zacks Rank as Green Plains, both Ingevity Corporation and Minerals Technologies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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Green Plains (GPRE) is Now a Strong Buy: Should You Add?
Zacks Investment Research upgraded Green Plains Inc. (GPRE - Free Report) to a Zacks Rank #1 (Strong Buy) on Sep 13, 2016. Going by the Zacks model, companies sporting a Zacks Rank #1 have strong chances of outperforming the broader market in the near term.
Why the Upgrade?
Market sentiments have been favoring Green Plains since the beginning of 2016, as evident from the 9.9% rise in the company’s share price to date. Also, the company’s financial performance in last quarter has been impressive, with earnings of 21 cents per share surpassing the Zacks Consensus Estimate of break-even level.
Green Plains’ top line was driven by healthy results in the ethanol production, agribusiness and marketing and distribution businesses. Ethanol production in the quarter was strong, while the same is anticipated to be better in second half of 2016. Also, the company aims at a sound capital allocation policy of rewarding its shareholders handsomely through dividends and share buybacks. It also plans on investing in organic and inorganic growth opportunities.
In Aug 2016, Green Plains announced that it will be acquiring three ethanol plants, with combined production capacity of 236 million gallons per year from Abengoa Bioenergy. The transaction has been valued at $237 million, to be paid in cash, plus some working capital adjustments. Post the completion of the transaction by the end of Sep 2016, the company will own 17 dry mill ethanol facilities, with an estimated combined annual production capacity of 1.5 billion gallons.
Impressive results and outlook have made investors optimistic about Green Plains’ prospects. Over the last 60 days, the Zacks Consensus Estimate for the stock increased from loss per share of 13 cents to earnings of 21 cents for 2016, while it increased 24.1% to $1.34 per share for 2017. Also, the company has an Earnings ESP of +66.67% for 2016 and +11.94% for 2017.
GREEN PLAINS Price and Consensus
GREEN PLAINS Price and Consensus | GREEN PLAINS Quote
Other Stocks to Consider
Green Plains Inc. currently has a market capitalization of $962.6 million. Other stocks worth mentioning in the chemical specialty industry include NL Industries Inc. (NL - Free Report) , Ingevity Corporation (NGVT - Free Report) and Minerals Technologies Inc. (MTX - Free Report) . While NL Industries sports the same Zacks Rank as Green Plains, both Ingevity Corporation and Minerals Technologies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>