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

Analyst Recommendations

This is a summary of recent ratings and price targets for Aemetis and Pacific Ethanol, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aemetis 0 2 0 0 2.00
Pacific Ethanol 0 0 4 0 3.00

Aemetis currently has a consensus price target of $2.00, indicating a potential upside of 203.03%. Pacific Ethanol has a consensus price target of $11.50, indicating a potential upside of 155.56%. Given Aemetis’ higher possible upside, analysts plainly believe Aemetis is more favorable than Pacific Ethanol.

Insider and Institutional Ownership

25.7% of Aemetis shares are held by institutional investors. Comparatively, 80.4% of Pacific Ethanol shares are held by institutional investors. 24.1% of Aemetis shares are held by company insiders. Comparatively, 3.9% of Pacific Ethanol shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Aemetis has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500. Comparatively, Pacific Ethanol has a beta of 2.13, indicating that its stock price is 113% more volatile than the S&P 500.

Earnings and Valuation

This table compares Aemetis and Pacific Ethanol’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Aemetis $143.16 million 0.09 -$15.63 million ($1.01) -0.65
Pacific Ethanol $1.62 billion 0.12 $1.41 million ($0.23) -19.57

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.

Profitability

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

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

Summary

Pacific Ethanol beats Aemetis on 10 of the 13 factors compared between the two stocks.

About Aemetis

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.

About Pacific Ethanol

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.

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