Why Renewable Energy Group's Shares Popped

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of biodiesel company Renewable Energy Group jumped 12% today after reporting earnings.

So what: Revenue rose 42% in the quarter to $387.1 million and net income rose 73% to $19.6 million, or $0.62 per share. Earnings only met expectations, but the revenue figure easily passed analyst estimates of $303.4 million.  

Now what: Production and gallons sold were strong, making for the best quarter ever for the company. Based on full-year earnings estimates of $2.84 from Wall Street, even after today's jump the stock only trades at 5.5 times this year's earnings. That gives the stock upside, particularly if management can find a way to grow going into 2014.

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The article Why Renewable Energy Group's Shares Popped originally appeared on Fool.com.

Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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