Why Renewable Energy Group's Shares Popped

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 (NASDAQ: REGI  ) 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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