Random PEIX Thoughts
The ethanol industry needs an immediate boost in processing Margins, In the current environment, The stronger players such as ADM, VLO and GPRE are barely breaking even if that. Weaker companies such as PEIX are loosing money.
Quarter ending June 30 comparing USDA data on price of ethanol plus distillers grain sales less cost of corn looks to be similar to prior two quarters and subsequent quarterly reports... First 12 weeks of quarter ending June 30 are (51.80 per gallon), verses 03/31/2018 of 52.44 12/31/2018 amount of (50.03). Loss reported for 3/31 and 12/31 were 8 million and 13.6 million respectively. Prior five quarters to 6/30/2018. So it looks as though PEIX has a loss somewhere in the neighborhood of 10.8 million for quarter ending 6/30/2018. PEIX has reported losses totaling of 44.4 million five prior quarters to 6/30/201/8
How long can PEIX operate in this lack of processing margin environment?
PEIX is a survivor and are the losses during past five quarters and current lack of margin from the crush spread what has triggered the 34% decline in stock price since May 21 close of $3.70 and 44% during the 2018 year?
What does MGMT have up their sleeves to move back to profitability and restore working capital?
Raise income from share dilution?
Reverse Split?
Become more efficient?
Sell the Company?
Will EPA and USDA continue to support Ethanol Industry.
Will the USDA or the
These are all strategies that MGMT has used during rough patches in the history of the company. If margins do not improve will 11
again be considered?
One area I noticed that supplements the tough times is Kinergy who markets the companies ethanol production and third party gallons..
Why have the 3rd party gallons that the Company markets declined by 20 million gallons since quarter ending 06/30/2018?
Historically when PEIX stock is hammered in the marketplace, short interest is much higher than the current 6.66%.
Is a large trading group selling off its shares due to being on the wrong side of the market on other trades.
Margins and stock prices always go higher than they should and move lower than you think they will in commodity driven and Ag processing businesses.
I look to see an increase in share price this week. The stock is oversold. Ag processing is a cyclical business. The crush spread will improve, It would be nice to know when.
Any one have and ideas on how this company will reverse its trend?
