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 FutureFuel Corp. Shares Flew

By Brian D. Pacampara, CFA - Mar 18, 2014 at 1:00PM

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

Is this meaningful or just another movement?

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 chemical and biofuels manufacturer FutureFuel ( FF 1.30% ) soared 20% on Tuesday after its quarterly results impressed Wall Street.

So what: The stock has rallied in recent months optimism over accelerating growth, and today's strong Q4 results -- net income spiked 327% on revenue growth of 68% -- only reinforce those good vibes. In fact, adjusted operating margin for the quarter clocked in at 22.4% versus just 8% in the year-ago period, suggesting that FutureFuel's competitive position and cost structure are improving as well.

Now what: Don't expect the operating momentum to slow anytime soon. "We are committed to improve and position our company for future growth both organically as well coupled with strategic acquisitions when appropriate," said President Lee Mikles. "We strive to be very shareholder aware with our continued dividend policy paired with an exceptionally strong balance sheet." Of course, with the stock now off about 20% from its 52-week highs, that short-term uncertainty might be providing patient biotech-savvy Fools with a juicy entry point.

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

FutureFuel Corp. Stock Quote
FutureFuel Corp.
FF
$7.78 (1.30%) $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
652%
 
S&P 500 Returns
142%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/09/2021.

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.