(NEW YORK)–As coronavirus cases surge, forcing new lockdowns, Pacific Ethanol (NASDAQ:PEIX) production of specialty alcohol for sanitizer products could put this as a way to play the “second wave” COVID-19 outbreak.
PEIX climbed 85% in September as investors recognized that demand for sanitizers and disinfectants will continue to be strong as the fall and winter COVID-19 outbreak escalates.
Specialty alcohols used in consumer products sell at a PREMIUM to fuel grade ethanol, and contributed 45% of PEIX revenues during the first nine months of 2020, compared with only 15% for all of 2019.
On Sept. 14, Pacific Ethanol announced that it was expanding annual production capacity from 85 million gallons at the end of the recently completed second quarter to 140 million gallons at the start of 2021. This sets the stage for explosive revenue growth for PEIX going forward.
Alcohol Sanitizers and COVID-19
In case you haven’t been paying attention to the market COVID-19 cases are surging again as we head into the fall/winter season. This has resulted in new and pending lockdowns in Spain, France, Germany, Italy, UK, and Ireland.
In a note to subscribers, Ludlow Research placed PEIX on its watch list stating, “With coronavirus cases spiking to record highs in the US we could start to see targeted shutdowns in select areas the US, especially as hospitals reach full capacity. This could draw investor interest towards PEIX as supplier of alcohol for sanitizers and healthcare market, along with their improved revenue outlook.”
H.C. Wainwright raised its price target on PEIX to $16
About Pacific Ethanol, Inc.
Pacific Ethanol, Inc. (PEIX) is a leading producer of specialty alcohols and essential ingredients. The company is focused on products for four key markets: Health, Home & Beauty, Food & Beverage, Essential Ingredients and Renewable Fuels. The company’s customers include major food and beverage companies and consumer products companies. Pacific Ethanol’s subsidiary, Kinergy Marketing LLC, markets all specialty alcohol products for Pacific Ethanol’s distilleries as well as fuel grade ethanol for third parties. Pacific Ethanol’s subsidiary, Pacific Ag. Products LLC, markets wet and dry distillers grains. For more information please visit www.pacificethanol.com
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