Xethanol Corporation is an AMEX listed security that has been trading in a range between $1.12 and $9.00 over the past year. With 28,609,100 shares outstanding, a recent price of $1.62 gives a total market capitalization of $44,003,657. While there are certainly larger companies, Xethanol Corporation has definitely earned its place in the pack. Last year, Xethanol Corporation created $-1.02 in earnings for every share outstanding.
Xethanol Corporation is currently priced by the market at 0.00 times last year’s earnings. Many trading multiples around the world are quite attractive these days, but don’t be fooled. A Price to Earnings ratio of 0 simply means that the security didn’t make any money last year.
With a share price under $50 a share and earnings per share below $1 a share, Xethanol Corporation is unlikely to be an interesting value proposition.
Showing posts with label Ethanol. Show all posts
Showing posts with label Ethanol. Show all posts
Thursday, July 19, 2007
Monday, July 2, 2007
Archer-Daniels-Midland
Archer-Daniels-Midland is among the world’s largest Agricultural Products sector businesses in the world. Archer-Daniels-Midland’s employees generate $1.617B in profits on $41.351B of revenue. Global output in the Agricultural Products business will likely rise substantially over the next 10 years. Long-term economic growth may lift all boats, but Archer-Daniels-Midland is determined to remain a market leader. Sectoral leadership in the Agricultural Products segment takes dedication and consistency, but management seeks out-sized growth.
Archer-Daniels-Midland’s ticker symbol ADM has recently been trading near $34.35 a share. The Archer-Daniels-Midland corporate headquarters in Minneapolis, Minnesota predicts Agricultural Products profits will satisfy shareholders in search of risk-appropriate returns.
The significance of market volume is sometimes ignored, but with a total market capitalization of $22.437B ensures sufficient liquidity. With a beta of 0.58, the company is less volatile than the market as a whole. When the average equity moves lower, Archer-Daniels-Midland moves less aggressively.
Archer-Daniels-Midland’s ticker symbol ADM has recently been trading near $34.35 a share. The Archer-Daniels-Midland corporate headquarters in Minneapolis, Minnesota predicts Agricultural Products profits will satisfy shareholders in search of risk-appropriate returns.
The significance of market volume is sometimes ignored, but with a total market capitalization of $22.437B ensures sufficient liquidity. With a beta of 0.58, the company is less volatile than the market as a whole. When the average equity moves lower, Archer-Daniels-Midland moves less aggressively.
Wednesday, June 13, 2007
Ag Policy and the Great Ethanol Swindle
The agriculture lobby has an out-sized influence on the political process in the United States because of its history of aggressive lobbying, an accident of the electoral system, and a palatable storyline for the masses.
Agriculture is the ultimate commodity business. It has to be. Only the market for air is more biased against producers. If the supply of food ever falls below demand, or even stays particularly close to equilibrium, the country is in crisis. The government has a vested interest in making sure that farmers don't go out of business, but if food grows too expensive that's nearly as big of a political problem.
Farmers have a long history of organizing in order to secure government bailouts to protect them from drought and pestilence. And government has an equally long history of scoring political points by giving in.
Agriculture also benefits from the out-sized voice of rural states in the US Senate. But even in rural states like Nebraska, a surprisingly small portion of the population is actually involved in agriculture. The mascot at the football game may be a "Cornhusker", but the fans in the stadium have mostly desk jobs. Yet a winner takes all political system that is heavily dependent on monetary donations plays right into the hands of a highly organized lobby.
But perhaps agriculture's most effective resource is its storyline. The small American family farmer is a complete anachronism. Most of the country's food has been produced by corporations for years now, but the farm lobby has entrenched a poverty stricken farmer in America's collective consciousness.
The problem with ethanol is not that it takes more energy to produce ethanol than ethanol gives off when it is burned. Despite impossibly biased studies to the contrary, this contention has been substantially rebutted. Rather, ethanol is simply produced in the most inefficient manner possible.
Ethanol in the United States is made from corn. Nobody else in the world uses corn ethanol because sugar ethanol is much more efficient. Depending on how that difference is calculated, sugar ethanol can be eight times as effective. But the sugar lobby doesn't to make ethanol. That's because sugar from sugar cane is much better for ethanol than sugar from sugar beets. And sugar cane is subject to enormous import restrictions to protect domestic sugar production. So why do we make ethanol from corn instead of imported sugar cane? Because the corn lobby is one of the most powerful voices in Washington.
Corn and sugar growers don't always see eye to eye, but you can thank America's unique system for determining ag policy for the great ethanol swindle.
Just don't think ethanol can be saved by rationalizing our production. Brazil is the world's ethanol success story. Brazil makes ethanol from sugar cane and has a much better infrastructure for using ethanol that the United States. But Brazil's energy independence is owed to gigantic oil fields rather than humble farmers. Brazil won't be fazing out oil anytime soon, because it can't. Ethanol is interesting, but it's not a panacea.
Agriculture is the ultimate commodity business. It has to be. Only the market for air is more biased against producers. If the supply of food ever falls below demand, or even stays particularly close to equilibrium, the country is in crisis. The government has a vested interest in making sure that farmers don't go out of business, but if food grows too expensive that's nearly as big of a political problem.
Farmers have a long history of organizing in order to secure government bailouts to protect them from drought and pestilence. And government has an equally long history of scoring political points by giving in.
Agriculture also benefits from the out-sized voice of rural states in the US Senate. But even in rural states like Nebraska, a surprisingly small portion of the population is actually involved in agriculture. The mascot at the football game may be a "Cornhusker", but the fans in the stadium have mostly desk jobs. Yet a winner takes all political system that is heavily dependent on monetary donations plays right into the hands of a highly organized lobby.
But perhaps agriculture's most effective resource is its storyline. The small American family farmer is a complete anachronism. Most of the country's food has been produced by corporations for years now, but the farm lobby has entrenched a poverty stricken farmer in America's collective consciousness.
The problem with ethanol is not that it takes more energy to produce ethanol than ethanol gives off when it is burned. Despite impossibly biased studies to the contrary, this contention has been substantially rebutted. Rather, ethanol is simply produced in the most inefficient manner possible.
Ethanol in the United States is made from corn. Nobody else in the world uses corn ethanol because sugar ethanol is much more efficient. Depending on how that difference is calculated, sugar ethanol can be eight times as effective. But the sugar lobby doesn't to make ethanol. That's because sugar from sugar cane is much better for ethanol than sugar from sugar beets. And sugar cane is subject to enormous import restrictions to protect domestic sugar production. So why do we make ethanol from corn instead of imported sugar cane? Because the corn lobby is one of the most powerful voices in Washington.
Corn and sugar growers don't always see eye to eye, but you can thank America's unique system for determining ag policy for the great ethanol swindle.
Just don't think ethanol can be saved by rationalizing our production. Brazil is the world's ethanol success story. Brazil makes ethanol from sugar cane and has a much better infrastructure for using ethanol that the United States. But Brazil's energy independence is owed to gigantic oil fields rather than humble farmers. Brazil won't be fazing out oil anytime soon, because it can't. Ethanol is interesting, but it's not a panacea.
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