Green Plains Renewable Energy (GPRE) Target Lifted at Imperial Capital

Imperial Capital analyst Matthew Farwell reiterated an Outperform rating on Green Plains Renewable Energy (NASDAQ: GPRE) and boosted his price target from $25 to $35. The firm is also raising 2014E EBITDA to $290 million from $199 million, which they believe is 20% above consensus of $250 million.

Farwell comments, "The acquisition of two ethanol plants in mid-4Q14 should push shipments up about 10% in 1Q14E EBITDA and our estimate of $76mn assumes steady or higher margins. Cold weather-related rail bottlenecks have caused a positive but potentially short-lived spike in spot margins (we estimate an increase of over $1.00 per gallon in recent weeks), as ethanol facilities have backed down production, resulting in a decline in ethanol stocks. "

He added, "While we expect rail issues to be resolved with the warmer weather, gasoline demand growth and more rational supplier behavior have created an improved 2H14 margin outlook. GPRE could currently lock in above $0.30 per gallon for 3Q14, while 2H14 consensus EBITDA for the company is approximately $110mn, implying about $0.17 per gallon in the ethanol segment."

For an analyst ratings summary and ratings history on Green Plains Renewable Energy click here. For more ratings news on Green Plains Renewable Energy click here.

Shares of Green Plains Renewable Energy closed at $28.95 yesterday.

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