Pacific Ethanol (NASDAQ: PEIX) and Aemetis (NASDAQ:AMTX) are both small-cap ethanol fuels companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, profitability, valuation and risk.

Insider and Institutional Ownership

79.7% of Pacific Ethanol shares are held by institutional investors. Comparatively, 18.7% of Aemetis shares are held by institutional investors. 3.9% of Pacific Ethanol shares are held by company insiders. Comparatively, 24.1% of Aemetis shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Pacific Ethanol and Aemetis’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Pacific Ethanol $1.62 billion 0.12 $1.41 million ($0.23) -18.91
Aemetis $143.16 million 0.10 -$15.63 million ($1.01) -0.69

Pacific Ethanol has higher revenue and earnings than Aemetis. Pacific Ethanol is trading at a lower price-to-earnings ratio than Aemetis, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Pacific Ethanol has a beta of 2.13, suggesting that its share price is 113% more volatile than the S&P 500. Comparatively, Aemetis has a beta of 1.47, suggesting that its share price is 47% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Pacific Ethanol and Aemetis, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pacific Ethanol 0 0 3 0 3.00
Aemetis 0 2 0 0 2.00

Pacific Ethanol currently has a consensus price target of $13.00, suggesting a potential upside of 198.85%. Aemetis has a consensus price target of $2.00, suggesting a potential upside of 185.71%. Given Pacific Ethanol’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Pacific Ethanol is more favorable than Aemetis.

Profitability

This table compares Pacific Ethanol and Aemetis’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pacific Ethanol -0.51% -2.13% -1.23%
Aemetis -15.79% N/A -31.90%

Summary

Pacific Ethanol beats Aemetis on 11 of the 13 factors compared between the two stocks.

Pacific Ethanol Company Profile

Pacific Ethanol, Inc. (Pacific Ethanol) is a marketer and producer of low-carbon renewable fuels in the Western United States. Pacific Ethanol markets all the ethanol produced by four ethanol production facilities located in California, Idaho and Oregon, or the Pacific Ethanol Plants, all the ethanol produced by three other ethanol producers in the Western United States and ethanol purchased from other third-party suppliers throughout the United States. It also markets ethanol co-products, including wet distiller’s grains and syrup (WDG), for the Pacific Ethanol Plants. Its 83% ownership interest in New PE Holdco LLC, the owner of each of the plant holding companies, that collectively own the Pacific Ethanol Plants. Its ethanol customers are integrated oil companies and gasoline marketers who blend ethanol into gasoline. Effective September 02, 2014, Pacific Ethanol Inc raised its interest to 96% from 91%, by acquiring a 5% interest, in PE Op Co.

Aemetis Company Profile

Aemetis, Inc. is an international renewable fuels and biochemicals company. The Company is focused on the production of fuels and chemicals through the acquisition, development and commercialization of technologies that replace traditional petroleum-based products by conversion of first-generation ethanol and biodiesel plants into biorefineries. Its segments include North America and India. The North America segment includes the Company’s approximately 60 million gallon per year capacity ethanol manufacturing plant in Keyes, California and its technology lab in College Park, Maryland. The India segment includes the Company’s over 50 million gallon per year capacity biodiesel manufacturing plant in Kakinada, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. The Keyes plant produces denatured ethanol, Wet Distillers Grains, corn oil and Condensed Distillers Solubles. It produces biodiesel and refined glycerin at the Kakinada plant.

Receive News & Stock Ratings for Pacific Ethanol Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Pacific Ethanol Inc. and related stocks with our FREE daily email newsletter.