Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why Pacific Ethanol Stock Just Soared 14.5%

By Rich Smith - Jan 13, 2021 at 12:35PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

What's in a name?

What happened

Shares of Pacific Ethanol ( ALTO 2.14% ) are rocking Wednesday, up 14.5% at 11:45 a.m. EST.

But wait: Did I get that name right?

Rising red stock arrow representing a stock going up drawn on a yellow background

Image source: Getty Images.

So what

This morning, Pacific Ethanol announced that effective yesterday, it has changed its corporate name to Alto Ingredients. Most financial data providers haven't clued into the switch just yet (or they're waiting until tomorrow, when the Nasdaq is supposed to officially change its reporting data), but investors still seem pretty excited about it already.  

As the now-renamed Alto explained, it chose the new name to represent a new focus on producing alcohol for products such as cleaning solutions and pharmaceuticals, as opposed to the company's previous, money-losing focus on producing ethanol as a fuel additive.

Now what

The company isn't getting out of the fuel business entirely, however. Alto says it will continue to process corn into high-protein feed, pet food, and renewable fuel as well.

It remains to be seen whether the new focus on sanitizers and disinfectants will produce enough profit to consistently offset losses from the legacy ethanol biz, but for the first time since late 2016, the company did manage to achieve back-to-back profits in the second and third quarters of 2020. Investors today seem to be betting it will do it again in the fourth quarter and beyond.

The company plans to change its Nasdaq ticker symbol to ALTO to match its new name on Feb. 1.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Alto Ingredients, Inc. Stock Quote
Alto Ingredients, Inc.
ALTO
$4.78 (2.14%) $0.10

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
624%
 
S&P 500 Returns
140%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/07/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.