Gevo, Inc. (NASDAQ: GEVO)
Gevo has been a very interesting stock to watch as of late, and for good reason. Throughout the past several months, the company has been the topic of various press releases having to do with green energy and company growth. We’ve seen flights with Alaska Airlines, we’ve seen a contract with Musket, and now investors are wondering what we can expect to see next. In a recent discussion with Pat Gruber, the CEO of the company, he brought up something that could be the next big thing in clean energy. Today, we’ll talk about what that is and why I maintain such a bullish opinion on GEVO.
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We Know About Isobutanol, What Else Is There At GEVO?
So, we know about isobutanol, and it’s an exciting thing for Gevo investors. However, as mentioned above, in a recent discussion with Pat, he brought up isooctane. Like most people, I wasn’t so interested in this because I really didn’t understand what it was. When we see octane at the pump, we think oh… OK, it’s some kind of additive that makes gasoline work. However, that’s not the case at all, it actually represents about 90% of the gasoline that we put in our vehicles.
In our conversation, Pat explained that isooctane is the wave of the future, and that GEVO is the only company that appears to have the technology to generate it. Moving forward, this could be a massive thing. Here’s what Pat had to say about isooctane:
“It’s like I said… the interest has been generated from the jet fuel, and we also have isooctane. Everyone forgets about isooctane because I think they don’t understand it. This is something to think about. When people see octane, they think, ‘Oh that’s stuff that’s labeled on gasoline’, or the ethonol guys all go, ‘Oh well that’s what ethanol provides, octane.’ That’s not what I’m talking about. What I’m talking about is… if ethanol does 10% of the gasoline, we can do the other 90% of the gasoline. That’s what I’m talking about. That’s a big deal as low-carbon fuels come into play to the future. Because how else will someone get it? We appear to have the only viable technology to make that stuff.”
After this discussion, I looked into what octane actually represented in gasoline. After doing so, I’ve come to the conclusion that if GEVO can get a low carbon, renewable, clean octane to the market, it will likely be the goose that lays the golden eggs for the company and its investors.
Isooctane Is Down The Line, Isobutanol Is Now
The reality is that, when it comes to Gevo, there are several reasons to be excited. In the long run, isooctane will likely prove to be a huge thing for the company. However, right now, the focus is on isobutanol. At the end of the day, the company has already put together an agreement with Musket for the distribution of isobutanol blended fuels. The company has already sold jet fuel derived from isobutanol to a major airline that then flew commercial flights on that fuel and said they would buy more. At the end of the day, isobutanol has tons of potential to drive revenue for the company in the very near future.
Mixing The Two Is A Match Made In Heaven
At the moment, there are quite a few questions revolving around Gevo. People want to know what the demand for isobutanol blended fuels will be, how the product is being marketed and more. Not to mention, they want to know what’s coming down the line. With the shift toward green energy around the world, I believe that the answers to all of these questions are likely positive. Demand for a cleaner fuel to run vehicles on is likely huge. Isooctane can fill that demand. In the mean time, there’s promising news surrounding isobutanol. Between the two, we have the here and now and we have the strong future prospect. As a result, I’m expecting to see gains in the stock ahead.
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What Do You Think?
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