NEW YORK (
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally poor debt management and disappointing return on equity.
Highlights from the ratings report include:
- GPRE's very impressive revenue growth greatly exceeded the industry average of 39.6%. Since the same quarter one year prior, revenues leaped by 90.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, GREEN PLAINS RENEWABLE ENRGY's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The gross profit margin for GREEN PLAINS RENEWABLE ENRGY is currently extremely low, coming in at 4.10%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.60% trails that of the industry average.
Green Plains Renewable Energy, Inc. engages in the production, marketing, and distribution of ethanol and related distillers grains in the United States. The company has a P/E ratio of 9.6, above the average chemicals industry P/E ratio of 9.5 and below the S&P 500 P/E ratio of 17.7. Green Plains Renewable Energy has a market cap of $358 million and is part of the
industry. Shares are down 15.9% year to date as of the close of trading on Tuesday.
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