VeraSun Energy: A Growth Stock Reborn

VeraSun Energy (VSE), the country’s largest ethanol producer managed to handily beat the analysts' estimates for the 2nd quarter of 2008. Estimates for the quarter’s per share earnings ranged from a -7¢ to a positive 12¢, with the average of 18 analysts at 2¢ earnings. Actual earnings came in at 15¢ per share, well above the average and handily beating the most optimistic. The 15¢ per share also almost doubles the 8¢ earned in Q1, 2008. VSE’s total revenues of $1.015 billion also exceeded the average estimate of $924 million.

The most interesting point of the press release is that VeraSun sold 330 million gallons of ethanol to its customers which included 83.4 million gallons it purchased from other producers to resell. There is obviously plenty of demand for the company’s future increasing production. Company management has stated it has very little margin in the resold fuel, but wants to keep its customers supplied and satisfied.