BWS Financial Inc

BWS provides independent stock specific research focused on companies with distinct value that are going through a special situation where there is a tangible catalyst not priced in. The catalyst can be anything from new product, restructuring, M&A, management change, change in business strategy, etc. BWS’s focus is to understand the change and evaluate the potential return for investors.

BWS utilizes a self formed proprietary approach in discovering stocks by putting great emphasis on deep research. BWS does generate short recommendations following a similar criteria.

Independent Stock Specific Research

Renewable Energy Group (REGI):  Sell Short

REGI: Widening Margin Fuels Outperformance

Founder, BWS Financial Inc

Hamed Khorsand

Founder

Equity Bottom-Up

Renewable Energy Group / Equity Bottom-Up

<ul type="disc"><li>
Renewable Energy Group (REGI) reported third quarter results supporting our forecast of continued improving margins. The positive traction in margins enables REGI to sustain its capital expansion plans for its Geismar facility without seeking additional outside capital.</li></ul> <ul type="disc"><li>The third quarter included the impact of Hurricane Ida forcing the closure of Geismar for two weeks. The reduced output is expected to have an impact on gallons sold in the fourth quarter.</li></ul> <ul type="disc"><li>REGI’s management is projecting a broader customer base for renewable diesel that could result in wider profit margins in the coming year. The marine industry has turned from its IMO 2020 mandate of reducing sulfur to also consider reducing carbon emissions. The railroad industry is also evaluating using renewable diesel.</li></ul> <ul type="disc"><li>Our expectation for REGI to post adjusted EBITDA of $336.1 million in 2022 compared to $298.4 million in 2021 helps sustain our reasoning of why we continue to believe the shares should be trading above our price target of $100.</li></ul>


Renewable Energy Group (REGI) reported third quarter results supporting our forecast of continued improving margins. The positive traction in margins enables REGI to sustain its capital expansion plans for its Geismar facility without seeking additional outside capital. The third quarter included the impact of Hurricane Ida forcing the closure of Geismar for two weeks. The reduced output is expected to have an impact on gallons sold in the fourth quarter. REGI’s management is projecting a broader customer base for renewable diesel that could result in wider profit margins in the coming year. The marine industry has turned from its IMO 2020 mandate of reducing sulfur to also consider reducing carbon emissions. The railroad industry is also evaluating using renewable diesel. Our expectation for REGI to post adjusted EBITDA of $336.1 million in 2022 compared to $298.4 million in 2021 helps sustain our reasoning of why we continue to believe the shares should be trading above our price target of $100.

Renewable Energy Group

REGI: Carbon Emission Earnings Growth