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ALTO vs. GPRE: Which Renewable Fuels Stock is a Better Investment?
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Key Takeaways
ALTO is shifting from ethanol to specialty alcohols and ingredients with stable, higher-margin potential.
GPRE is commercializing low-carbon sugars and cutting debt to reduce reliance on volatile ethanol markets.
Both stocks rose 17.4% in a year, but ALTO's 2026 EPS growth estimate & valuation favor its investment case.
The renewable fuels industry is experiencing a structural transformation — from a commodity-based market toward a policy-backed, decarbonization-oriented energy sector, focusing more on low-carbon, higher-value fuel. Demand is mostly shaped by low-carbon fuel standards and clean fuel tax credits, with global capacity expected to triple by 2028 as per a Bain & Company report. In this context, Alto Ingredients (ALTO - Free Report) and Green Plains (GPRE - Free Report) are worth mentioning.
Alto is a leading producer and distributor of specialty alcohols, renewable fuels and essential ingredients in the United States. It is poised to gain from its compelling portfolio, its focus on customer relationships, and its leveraging of technologies. On the other hand, Green Plains has grown to be a leading biorefining company, maximizing the potential of existing resources through fermentation and patented agribusiness technologies.
Let's discuss in detail.
The Case for ALTO
Alto Ingredients is in the midst of a strategic evolution, shifting from a conventional fuel ethanol producer to a more diversified business focused on specialty alcohols and essential ingredients. Leveraging its long-operating history and existing production footprint, the company is repositioning toward higher-value, quality-driven end markets that offer more stable demand and improved margin potential.
The product mix has expanded beyond commodity ethanol to include specialty alcohols and ingredients serving pharmaceutical, personal care, food, and industrial applications. This transition is designed to diversify revenue streams, reduce exposure to volatile ethanol pricing, and unlock greater value from Alto’s established assets and customer relationships.
A key element of the strategy is reducing carbon intensity scores to benefit from the federal Section 45Z clean fuel tax credit. Management is prioritizing capital-efficient projects with clear execution timelines and attractive returns while improving environmental performance. If targeted carbon reductions are achieved and credits are successfully monetized, Section 45Z could generate up to $18 million in incremental gross benefit over 2025–2026.
Alto is also expanding carbon dioxide capture and utilization at its Pekin and Columbia facilities, building on the Carbonic acquisition. Monetizing fermentation-derived carbon dioxide adds a higher-margin revenue stream that supports sustainability objectives and further diversifies earnings.
Operational discipline remains central to the company’s approach. Alto continues to streamline costs, exit underperforming activities, and focus capital on near-term opportunities with clear return visibility. Early signs of progress, including growth in renewable fuel export sales, underscore the flexibility of its operating platform. Nonetheless, risks persist, as the business remains capital-intensive and sensitive to corn and natural gas price volatility. ALTO shares have risen 17.4% over the past year.
The Case for GPRE
Green Plains is moving into higher-value sustainable ingredients by commercializing Clean Sugar Technology and producing low-carbon dextrose and glucose used as feedstocks for industrial fermentation and bioproduct applications.
Green Plains has experienced uneven profitability. It is reshaping its business mix toward higher-margin protein and renewable ingredients, which has weighed on short-term sales but is expected to improve stability. Green Plains aims to reduce exposure to ethanol cyclicality through diversification.
The company has restructured its balance sheet with no near-term debt maturities and improved liquidity through the sale of the Obion asset in Tennessee following its strategic review process that was initiated in February 2024. It also executed its first 45Z clean fuel production tax credit monetization agreement.
Green Plain intends to deploy capital in strengthening plant assets and maintaining or improving throughput, reducing carbon intensity through projects such as low energy distillation or combined heat and power, debottlenecking plant assets and incrementally expanding capacity. It also expects to de-lever the balance sheet through targeted debt reductions and also explore options for returning capital to shareholders over time.
Despite challenges, GPRE shares have risen 17.4% over the past year, suggesting improving investor sentiment.
Estimates for ALTO and GPRE
The Zacks Consensus Estimate for ALTO’s 2026 revenues implies a year-over-year increase of 10.5%, while that for EPS implies a year-over-year increase of 260%. However, EPS estimates witnessed no movement in the past 30 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for GPRE’s 2026 revenues implies a year-over-year increase of 5.2%, and that for EPS implies a year-over-year increase of 122.9%. EPS estimates witnessed southbound movement in the past 30 days.
Image Source: Zacks Investment Research
Are ALTO and GPRE Shares Expensive?
ALTO is trading at a forward price to earnings multiple of 16.88, above its median of 5.56 over the last three years. GPRE’s forward price-to-earnings multiple sits at 36.74, higher than its median of 25.02 over the last three years.
Image Source: Zacks Investment Research
Conclusion
Alto’s transition, strategic buyouts, focus on lowering carbon intensity score, cost-control efforts and its VGM Score of A instill confidence.
Green Plains is transitioning from a traditional ethanol producer into a low-carbon biorefining platform. It is positioned to benefit from decarbonization policy tailwinds, though execution and commodity price risks remain.
While both are expected to be profitable soon, ALTO, with a less expensive valuation and better price appreciation, has an edge over GPRE. ALTO carries a Zacks Rank #3 (Hold), while GPRE carries a Zacks Rank #4 (Sell).
Image: Shutterstock
ALTO vs. GPRE: Which Renewable Fuels Stock is a Better Investment?
Key Takeaways
The renewable fuels industry is experiencing a structural transformation — from a commodity-based market toward a policy-backed, decarbonization-oriented energy sector, focusing more on low-carbon, higher-value fuel. Demand is mostly shaped by low-carbon fuel standards and clean fuel tax credits, with global capacity expected to triple by 2028 as per a Bain & Company report. In this context, Alto Ingredients (ALTO - Free Report) and Green Plains (GPRE - Free Report) are worth mentioning.
Alto is a leading producer and distributor of specialty alcohols, renewable fuels and essential ingredients in the United States. It is poised to gain from its compelling portfolio, its focus on customer relationships, and its leveraging of technologies. On the other hand, Green Plains has grown to be a leading biorefining company, maximizing the potential of existing resources through fermentation and patented agribusiness technologies.
Let's discuss in detail.
The Case for ALTO
Alto Ingredients is in the midst of a strategic evolution, shifting from a conventional fuel ethanol producer to a more diversified business focused on specialty alcohols and essential ingredients. Leveraging its long-operating history and existing production footprint, the company is repositioning toward higher-value, quality-driven end markets that offer more stable demand and improved margin potential.
The product mix has expanded beyond commodity ethanol to include specialty alcohols and ingredients serving pharmaceutical, personal care, food, and industrial applications. This transition is designed to diversify revenue streams, reduce exposure to volatile ethanol pricing, and unlock greater value from Alto’s established assets and customer relationships.
A key element of the strategy is reducing carbon intensity scores to benefit from the federal Section 45Z clean fuel tax credit. Management is prioritizing capital-efficient projects with clear execution timelines and attractive returns while improving environmental performance. If targeted carbon reductions are achieved and credits are successfully monetized, Section 45Z could generate up to $18 million in incremental gross benefit over 2025–2026.
Alto is also expanding carbon dioxide capture and utilization at its Pekin and Columbia facilities, building on the Carbonic acquisition. Monetizing fermentation-derived carbon dioxide adds a higher-margin revenue stream that supports sustainability objectives and further diversifies earnings.
Operational discipline remains central to the company’s approach. Alto continues to streamline costs, exit underperforming activities, and focus capital on near-term opportunities with clear return visibility. Early signs of progress, including growth in renewable fuel export sales, underscore the flexibility of its operating platform. Nonetheless, risks persist, as the business remains capital-intensive and sensitive to corn and natural gas price volatility. ALTO shares have risen 17.4% over the past year.
The Case for GPRE
Green Plains is moving into higher-value sustainable ingredients by commercializing Clean Sugar Technology and producing low-carbon dextrose and glucose used as feedstocks for industrial fermentation and bioproduct applications.
Green Plains has experienced uneven profitability. It is reshaping its business mix toward higher-margin protein and renewable ingredients, which has weighed on short-term sales but is expected to improve stability. Green Plains aims to reduce exposure to ethanol cyclicality through diversification.
The company has restructured its balance sheet with no near-term debt maturities and improved liquidity through the sale of the Obion asset in Tennessee following its strategic review process that was initiated in February 2024. It also executed its first 45Z clean fuel production tax credit monetization agreement.
Green Plain intends to deploy capital in strengthening plant assets and maintaining or improving throughput, reducing carbon intensity through projects such as low energy distillation or combined heat and power, debottlenecking plant assets and incrementally expanding capacity. It also expects to de-lever the balance sheet through targeted debt reductions and also explore options for returning capital to shareholders over time.
Despite challenges, GPRE shares have risen 17.4% over the past year, suggesting improving investor sentiment.
Estimates for ALTO and GPRE
The Zacks Consensus Estimate for ALTO’s 2026 revenues implies a year-over-year increase of 10.5%, while that for EPS implies a year-over-year increase of 260%. However, EPS estimates witnessed no movement in the past 30 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for GPRE’s 2026 revenues implies a year-over-year increase of 5.2%, and that for EPS implies a year-over-year increase of 122.9%. EPS estimates witnessed southbound movement in the past 30 days.
Image Source: Zacks Investment Research
Are ALTO and GPRE Shares Expensive?
ALTO is trading at a forward price to earnings multiple of 16.88, above its median of 5.56 over the last three years. GPRE’s forward price-to-earnings multiple sits at 36.74, higher than its median of 25.02 over the last three years.
Image Source: Zacks Investment Research
Conclusion
Alto’s transition, strategic buyouts, focus on lowering carbon intensity score, cost-control efforts and its VGM Score of A instill confidence.
Green Plains is transitioning from a traditional ethanol producer into a low-carbon biorefining platform. It is positioned to benefit from decarbonization policy tailwinds, though execution and commodity price risks remain.
While both are expected to be profitable soon, ALTO, with a less expensive valuation and better price appreciation, has an edge over GPRE. ALTO carries a Zacks Rank #3 (Hold), while GPRE carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.