GEVO Stock: Here’s Why Investors Love Gevo

Gevo Inc (NASDAQ: GEVO) is headed up in the market this morning. If you’re looking for press releases or SEC filings, you’re not going to find anything. There’s been nothing new from the company for some time. 

But, there doesn’t have to be. 

The fact of the matter is that if there ever was a time to own GEVO stock, now is it. Here’s why:

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Gevo Fuels Are the Future of Transportation Energy

For those of you who haven’t been following Gevo, the company is in the clean energy industry. However, it’s not producing solar panels or wind turbines. Instead, the company is focused on transportation energy. 

Through its cutting edge, proprietary technology, GEVO has the ability to turn carbon feedstock, like waste wood, food, and other materials that generally end up in a landfill, into fuel. 

And the fuel is highly effective. 

Gevo themselves boast that their fuels are as effective, if not more so than, traditional fossil fuels. Moreover, due to the method of production, the fuels produced by GEVO are already renewable, moreover, they are far cleaner to burn than traditional fossil fuels. 

Over the past several years, the discussion surrounding the human carbon footprint on our beautiful planet has been heating up. Essentially, carbon emissions are a byproduct of just about everything in energy as we know it, including the energy that powers your vehicle. 

These emissions, also known as greenhouse gasses, are being blamed for an increasing temperature and intensifying storms and natural disasters across the planet. 

As a result, the world is moving toward clean energy. 

So, there’s never been a better time to consider investing in a company that aims to create a paradigm shift in how we power our vehicles, the source of a large chunk of the greenhouse gasses that are tarnishing our environment. 

A Biden Presidency Only Exacerbates the Opportunity

Considering the fact that the fuels produced by Gevo are clean, renewable, and effective, the opportunity is already exciting. However, with Joe Biden winning the recent United States Presidential Election, the excitement is only growing stronger. 

Throughout the past several years, Biden has been a major proponent of the climate change conversation. In fact, he has been very outspoken about his views that legislative changes need to take place in order to push the United States and the rest of the world toward clean energy options. 

That bodes incredibly well for Gevo and its investors. 

Soon, Joe Biden will occupy the White House, with a major goal being to bring down the carbon emissions in the United States. As a result, I’m expecting to see the following:

  • Grants. Under a Biden Presidency, we’re likely to see several government grants designed to fund the research, development, and commercialization of clean energy products. Considering that, when it comes to clean fuels, GEVO is the clear leader, the company is a prime target for these grants. 
  • Tax Cuts. Aside from funding provided by the United States government through grants, Gevo is also likely to benefit from tax cuts. After all, if you want people to focus on clean energy, you’ve got to reduce their tax burden associated with their accomplishments. 
  • Increasing Demand. The tax cuts aren’t only going to be for the companies that produce clean energy products. In fact, consumers are likely to benefit from tax cuts when they use clean energy products. As a result, demand for these products will likely increase, creating an opportunity for Gevo to significantly increase its revenue. 

All in all, a Biden Presidency opens the door to opportunity for the company.

Analyst Opinions of GEVO Stock 

While it’s never a good idea to blindly follow the opinions of Wall Street analysts, it is a good idea to use these opinions in order to validate your own. With that said, analysts have an overwhelmingly positive opinion surrounding what to expect from GEVO stock. 

According to TipRanks, two analysts currently cover GEVO stock, both of which rate the stock a buy. Moreover, the price targets on the stock are compelling. 

The low price target on GEVO is $2.50, with the high being $5, bringing the median price target to $3.75. 

Risks to Consider Before Buying GEVO Stock

Any time you make an investment, you’re accepting the risks associated with that investment. While GEVO is a compelling opportunity, it is not without risk. Here are the most significant risks investors should consider before buying GEVO stock:

  • A Speculative Play. At the moment, traditional fuels are the clear leader. Any time you predict a paradigm shift in an industry, you’re speculating. Speculating is dangerous because if things don’t go as you expect, significant declines can be the result. While there’s a strong argument that Gevo fuels will be the fuels of the future, the future is yet to be seen and there are speculation-related risks to consider here. 
  • GEVO Isn’t Making Money. Sure, Gevo is driving revenue through sales, but the revenue the company is driving isn’t actually leading to a profit. As a result, if the company can’t get to a profit before the cash on its balance sheet dries up, it will need to tap into capital markets for funding, ultimately diluting values for existing shareholders. 

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Final Thoughts

While there are always risks to consider, it’s hard to ignore the potential of an investment in GEVO stock as it stands right now. The company has been working for years to develop a technology that allows for the renewable development of clean fuels. 

At the moment, the world is looking for ways to reduce carbon emissions, ultimately reducing the devastating effects that developed nations are having on our environment. 

GEVO already has everything in place to increase capacity and take advantage of the flood of demand that’s likely ahead. Now, all it needs is for the incoming President to do what everyone expects him to do and Gevo fuels may quickly become the future of transportation energy.