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Green Plains Down to Strong Sell on Weak Q4, Dim Prospects

Zacks Equity Research

Zacks Investment Research downgraded Green Plains Inc. GPRE to a Zacks Rank #5 (Strong Sell) on Mar 11, 2016. Going by the Zacks model, companies holding a Zacks Rank #5 have strong chances of underperforming the broader market over the next few quarters.

Why the Downgrade?

Green Plains failed to impress investors in 2015, with the stock losing 5.8% over the year. In the four quarters last year, the company reported weaker-than-expected results in three, while meeting expectations in one. Average earnings surprise was a negative 90.06%.

Last quarter, Green Plains incurred a loss of 9 cents per share, while the Zacks Consensus Estimate was looking for earnings of 23 cents per share. In the year-ago quarter, the company had reported earnings of $1.07 per share. Revenue was down 10.8% year over year, hurt by weak sales generation from Product and Service business operations.

Disappointing quarterly results as well as prevalent uncertainties in the global market have made investors cautious of Green Plains’ prospects. Over the last 30 days, the Zacks Consensus Estimate has decreased 66.5% to 54 cents per share for 2016 and 25% to $1.35 for 2017. Also, the company has an Earnings ESP of -16.30% for 2017.

Stocks to Consider

Green Plains currently has a market capitalization of $551 million. Some better-ranked stocks in the chemical industry include Daqo New Energy Corp. DQ, Ferroglobe PLC GSM and Flexible Solutions International Inc. FSI. While Daqo New Energy sports a Zacks Rank #1 (Strong Buy), both Ferroglobe and Flexible Solutions International carry a Zacks Rank #2 (Buy).

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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
FERROGLOBE PLC (GSM): Free Stock Analysis Report
 
DAQO NEW ENERGY (DQ): Free Stock Analysis Report
 
FLEXIBLE SOLTNS (FSI): Free Stock Analysis Report
 
GREEN PLAINS (GPRE): Free Stock Analysis Report
 
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