Pacific Ethanol faces a fuel versus food debate.
Pacific Ethanol (NASDAQ: PEIX, Bullboard) has two strikes on it right now. One is that the cost of corn used to produce its core product is rising and there is a debate about whether biofuel companies should continue to get government incentives. The food versus fuel debate was made worse by the U.S. food CPI rising 0.9% last month, the most in 18 years.
PEIX has another issue. It has said it will release its Q1 numbers late. That usually does not make investors fell warm and fuzzy. If the results are good, it may not matter.
Stockholder concerns about the company are built into the price. The shares trade at $3.30, down from a 52-week high of $15.63. Bill Gates’ investment company recently cut its stake in the firm, but still owns almost 19%. The Microsoft (NASDAQ: MSFT, Bullboard) founder must still believe in "green".
It would be fair for Wall Street to be concerned about the fact that the company only made $2 million on revenue of $462 million last year.
This stock only moves up if corn prices move down. That may take awhile.
Stockhouse Conflict and Disclosure Policy:
Stockgroup Media Inc., owners and operators of Stockhouse.com, has established the following rules to ensure that there is no appearance of impropriety on the part of any Stockhouse Editorial writers ("Writers"). The content of Stockhouse Editorial articles (the "Articles") are the opinion of the Writer and any reliance on the content of these articles is at your sole risk. Our Writers are not registered investment advisors. You should not make any kind of investment decision in relation to Articles or stocks discussed in them without obtaining advice from a registered investment advisor.
Facts relied upon by our Writers are generally provided by the subject companies or gathered by our Writers from other public and/or private sources. These facts may be in error and if so, the opinions of our Writers may be materially different.
Writers may own, buy, or sell shares in public companies mentioned in their Articles, but in the Article they must prominently state their ownership position. Thus, a conflict may exist. Writers are not permitted to write Articles that attempt to benefit persons connected to the Writer, such as family or friends, except where disclosure is made in the same way as if the Writer him/herself owns stock.
Writers cannot solicit, accept, or agree to receive anything of value given or paid with the intent of influencing their Articles.
Stockhouse notifies each Writer about these rules, and we rely on the integrity of our Writers to ensure that our rules are followed.
