Stock Analysis

The Green Plains (NASDAQ:GPRE) Share Price Is Up 105% And Shareholders Are Boasting About It

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NasdaqGS:GPRE
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Unfortunately, investing is risky - companies can and do go bankrupt. On the other hand, if you find a high quality business to buy (at the right price) you can more than double your money! For example, the Green Plains Inc. (NASDAQ:GPRE) share price has soared 105% return in just a single year. It's also good to see the share price up 66% over the last quarter. The company reported its financial results recently; you can catch up on the latest numbers by reading our company report. It is also impressive that the stock is up 39% over three years, adding to the sense that it is a real winner.

View our latest analysis for Green Plains

Because Green Plains made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually expect strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

Green Plains actually shrunk its revenue over the last year, with a reduction of 20%. So we would not have expected the share price to rise 105%. It just goes to show the market doesn't always pay attention to the reported numbers. It's quite likely the revenue fall was already priced in, anyway.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

earnings-and-revenue-growth
NasdaqGS:GPRE Earnings and Revenue Growth February 17th 2021

We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. You can see what analysts are predicting for Green Plains in this interactive graph of future profit estimates.

A Different Perspective

We're pleased to report that Green Plains shareholders have received a total shareholder return of 105% over one year. That's better than the annualised return of 15% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For example, we've discovered 2 warning signs for Green Plains (1 is significant!) that you should be aware of before investing here.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

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