Jefferies Reports Ethanol Futures Curve Improving For Green Plains

In a report published by Jefferies, Green Plains GPRE ethanol futures curve is improving.

Jefferies said that following an 11% decline in corn prices since the end of February and only a 7% decline in the price of ethanol, the ethanol production cost curve appears to be improving. “While Green Plains has already locked in more than two-thirds of Q2 volumes, there could be upside to 2H11 results. We reiterate our Buy rating. Our 16/share price target is based 7.5x 2011 EBITDA and supported by our sum-of-the-parts analysis. Green Plains faces several risk factors, including: 1) volatility in gasoline demand and price points; 2) corn supply and price dynamics; 3) shifts in regulatory support.”

Green Plains closed yesterday at $11.99.