REX American Resources Corporation ( REX ) has rallied 60% this year, and thus it has vastly outperformed the S&P 500 ( SP500 ), which has gained 16% over the same period. After such a steep rally, it isI am a chemical engineer with a MS in Food Technology and Economics, and a MENSA member. I am the author of the book "Investing in Stocks and Bonds: The Early Retirement Project" (2024):I am also the author of the book "Mental Math: How to perform math calculations in your mind".I am also the author of 2 oth ...

Core Insights - Crude Value Insights provides an investment service and community focused on the oil and natural gas sector, emphasizing cash flow generation and growth potential [1] - Subscribers benefit from a model account featuring over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live discussions about the industry [1] Subscription Offer - A two-week free trial is available for new subscribers, allowing them to explore the oil and gas investment opportunities [2]

Group 1 - Crude Value Insights provides an investment service and community focused on the oil and natural gas sectors, emphasizing cash flow and companies that generate it [1] - The service offers subscribers access to a model account with over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live chat discussions about the sector [1] Group 2 - A two-week free trial is available for new subscribers, promoting engagement with the oil and gas market [2]

Download the Complete Report Here By Brandon Hornback REX American Resources Corp. (NYSE: REX) continued its long-running winning of streak, making it 21 straight profitable quarters. Ethanol volumes edged higher and operational discipline helped offset softer pricing, reinforcing REX’s position as one of the sector’s most reliable performers. Growth investments remain firmly on track: The One Earth Energy expansion, aiming to expand capacity to 200 million gallons, is progressing well toward the targeted ...

Group 1 - The article does not provide any specific information or data regarding companies or industries [1]

Ethanol Production and Revenue - As of October 31, 2025, the company holds majority ownership interests in two ethanol entities: One Earth Energy, LLC (76.1%) and NuGen Energy, LLC (99.7%) [107] - The company expects its ethanol plants to produce approximately 2.9 gallons of denatured ethanol for each bushel of corn processed, with the realized yield being critical for cash flow sustainability [108] - Ethanol revenue decreased by 2% in Q3 2025 compared to Q3 2024, attributed to a 5% decrease in selling price per gallon, despite a 4% increase in gallons sold [136] - Average selling price per gallon of ethanol (net of hedging) was $1.73 in Q3 2025, down from $1.83 in Q3 2024 [135] Financial Performance - Net sales and revenue for the three months ended October 31, 2025, were $175.6 million, a slight increase from $174.9 million in the same period of 2024 [134] - Gross profit for Q3 2025 decreased by approximately $3.5 million compared to Q3 2024, totaling $36.1 million [141] - Income before income taxes was approximately $35.5 million for Q3 2025, down from $39.5 million in Q3 2024 [147] - Net income for Q3 FY2025 was approximately $27.5 million, a decrease of 8.6% from $30.1 million in Q3 FY2024 [149] - Net income attributable to REX common shareholders for the first nine months of FY2025 was approximately $39.2 million, down 16.6% from $47.1 million in the same period of FY2024 [151] Capital Expenditures and Investments - The company has budgeted capital expenditures for expansion and carbon sequestration projects at One Earth to be approximately $220 million to $230 million, with $58.1 million already spent on the carbon sequestration project as of October 31, 2025 [117] - The company plans to spend an additional $25 million to $35 million on projects during the remainder of FY2025 [160] - Capital expenditures for FY2025 are expected to be between $220 million and $230 million, with $58.1 million already spent on the carbon sequestration project [160] Carbon Sequestration Initiatives - One Earth Energy, LLC is developing a carbon sequestration project and expects the EPA to prepare a draft permit by February 2026 and make a final decision by June 2026 [111] - The company has secured land easements for the construction of a CO2 pipeline for carbon sequestration, with capacity sufficient for an estimated 15 years [112] Market and Regulatory Environment - The IRA created a Clean Fuel Production Credit under Section 45Z, allowing tax credits between $0.02 and $0.20 per gallon based on GHG reduction, with the first two or ten cents earned upon achieving a CI score below 47.5 [116] - The EPA has issued Renewable Volume Obligations (RVOs) for 2023-2025, maintaining conventional biofuels volumes at 15.0 billion gallons for each year [125] Operational Metrics - Cost of sales increased by 3% in Q3 2025, with corn accounting for approximately 75% ($104.2 million) of total costs [140] - Dried distillers grains revenue fell by 11% in Q3 2025 compared to Q3 2024, due to a 6% decrease in tons sold and a 5% decrease in average price per ton [137] - Distillers corn oil revenue surged approximately 60% in Q3 2025 compared to Q3 2024, driven by a 36% increase in selling price per pound and a 17% increase in pounds sold [138] Cash Flow and Working Capital - Net cash provided by operating activities increased to $64.0 million in the first nine months of FY2025, compared to $39.1 million in the prior year [153] - Net cash provided by investing activities was $47.5 million in the first nine months of FY2025, up from $37.6 million in FY2024 [156] - Net cash used in financing activities was $35.8 million in the first nine months of FY2025, primarily for stock repurchases [158] - The current ratio as of October 31, 2025, was 7.2x, down from 8.6x in the previous year [152] - As of October 31, 2025, working capital was $354.2 million [159] Tax Credits and Audits - The company plans to vigorously defend approximately $24.5 million in research and experimentation tax credits under IRS audit [131] - Estimated decrease in pre-tax income from a 10% adverse change in ethanol prices is $47.1 million [165]

Financial Data and Key Metrics Changes - The net income per share for Q3 2025 was $0.71, an increase from $0.69 in Q3 2024, reflecting strong performance despite lower prices for ethanol and distillers grains [5][11] - Cash, cash equivalents, and short-term investments totaled approximately $335 million, maintaining a strong financial position with no bank debt [5][11] Business Line Data and Key Metrics Changes - Ethanol sales volumes reached 78.4 million gallons, up from 75.5 million gallons in Q3 2024, while the average selling price decreased to $1.73 per gallon from $1.83 [10] - Dried distillers grains sales volumes were approximately 160,000 tons, with an average selling price of $139.93 per ton, down from 170,000 tons and $147.14 per ton in the prior year [10] - Corn oil sales volumes increased by approximately 17% to 27.4 million pounds, with an average selling price rising by approximately 36%, leading to a 60% increase in sales revenue for corn oil [10] Market Data and Key Metrics Changes - U.S. ethanol exports were approximately 10% ahead of the 2024 pace, with exports 14% higher than the first eight months of 2024 [13] - The USDA projects that corn production in South Dakota and Illinois for the 2025-2026 harvest season will be among the highest in recent years, favoring lower input prices [14] Company Strategy and Development Direction - The company is focused on solidifying its core business of ethanol production and is progressing on the expansion of the One Earth Energy facility to 200 million gallons per year, expected to be completed in 2026 [4][8] - REX is actively engaged in evaluating potential benefits from the 45Z tax credits and is working on its carbon intensity score to qualify for these credits [5][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's operational excellence and strategic investments, which have led to superior results and a strong balance sheet [5][12] - The company expects the fourth quarter to generate a higher net profit than the previous year's fourth quarter, positioning itself well for growth in 2026 [15] Other Important Information - The company has invested approximately $155.8 million in carbon capture and ethanol expansion projects, remaining within a combined budget range of $220 million to $230 million for both initiatives [8][9] Q&A Session Summary Question: Thoughts on key hurdles and timing for the 45Z tax credit program - Management is awaiting guidelines from the Treasury and is reviewing calculations with experts, hoping to provide updates in the next quarter [17] Question: Impact of tariffs and crush spreads on the industry - Management noted that tariffs initially impacted exports to Mexico and Canada but have led to increased ethanol exports to Europe and other countries [19][20] Question: Update on the carbon sequestration project and permitting process - Management indicated that the moratorium on pipelines will end on July 1, allowing them to apply for permits thereafter [22] Question: Potential for partnerships regarding carbon capture - Management is focusing on the first well and has been in contact with potential partners but will not negotiate until permits are secured [30]

Financial Data and Key Metrics Changes - The net income per share for Q3 2025 was $0.71, an increase from $0.69 in Q3 2024, reflecting strong performance despite lower prices for ethanol and distillers grains [11] - Gross profit for Q3 2025 was $36.1 million, down from $39.7 million in Q3 2024, primarily due to lower prices [11] - Cash, cash equivalents, and short-term investments totaled approximately $335 million, maintaining a strong financial position with no bank debt [5][11] Business Line Data and Key Metrics Changes - Ethanol sales volumes reached 78.4 million gallons in Q3 2025, up from 75.5 million gallons in Q3 2024, while the average selling price decreased to $1.73 per gallon from $1.83 [10] - Dried distillers grains sales volumes were approximately 160,000 tons, with an average selling price of $139.93 per ton, down from 170,000 tons and $147.14 per ton in the prior year [10] - Corn oil sales volumes increased by approximately 17% to 27.4 million pounds, with an average selling price rising by approximately 36%, leading to a 60% increase in sales revenue for corn oil [10] Market Data and Key Metrics Changes - U.S. ethanol exports were approximately 10% ahead of the 2024 pace, with exports 14% higher than the first eight months of 2024 [13] - The USDA projects that corn production in South Dakota and Illinois for the 2025-2026 harvest season will be among the highest in recent years, favoring lower input prices [13] Company Strategy and Development Direction - The company is focused on solidifying its core business of ethanol production and expanding its One Earth Energy facility to 200 million gallons per year, expected to be completed in 2026 [4][5] - REX is actively engaged in evaluating potential benefits from the 45Z tax credits and is working on its carbon intensity score to qualify for these credits [5][12] - The company aims to leverage near-term opportunities provided by the 45Z tax credit program to enhance earnings as its ethanol production expansion and carbon sequestration facilities come online [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the fourth quarter, expecting to generate a higher net profit than the previous year's fourth quarter [14] - The company anticipates continued growth and improved performance in 2026, supported by a strong balance sheet and expanding business opportunities [14] - Management highlighted the importance of operational excellence and strategic investments in driving superior results [5][12] Other Important Information - The company has invested approximately $155.8 million in carbon capture and ethanol expansion projects, remaining within a combined budget range of $220 million to $230 million for both initiatives [8][9] - REX has maintained profitability for 21 consecutive quarters, reflecting the team's discipline and operational excellence [12] Q&A Session Summary Question: Thoughts on key hurdles and timing for the 45Z tax credit program - Management is awaiting guidelines from the Treasury and is reviewing facts with experts to determine potential tax credits, with updates expected next quarter [17] Question: Impact of tariffs and crush spreads on the industry - Management noted that tariffs initially impacted exports but have led to increased ethanol exports to Europe and other countries, with expectations for continued growth in 2026 [19][20] Question: Status of the carbon sequestration project and permitting process - Management indicated that the Illinois Commerce Commission is working on pipeline requirements, and the moratorium will end on July 1, allowing applications to proceed [21][22] Question: Potential for partnerships in carbon capture - Management is focusing on the first well's operation before negotiating contracts for carbon sequestration with third parties [30]

Financial Performance - REX reported Q3 '25 net sales and revenue of $175.6 million, a slight increase from $174.9 million in Q3 '24, representing a 0.4% growth[3] - Gross profit for Q3 '25 was $36.1 million, down from $39.7 million in Q3 '24, reflecting a decrease of approximately 8.9% due to lower ethanol and distillers grain pricing[3] - Net income attributable to REX shareholders in Q3 '25 was $23.4 million, compared to $24.5 million in Q3 '24, indicating a decline of 4.5%[4] - Diluted net income per share for Q3 '25 was $0.71, an increase from $0.69 per share in Q3 '24, marking a growth of 2.9%[4] Cash and Investments - REX's cash, cash equivalents, and short-term investments totaled $335.5 million as of October 31, 2025, with no bank debt[9] Expansion and Capital Expenditures - The company is progressing on the expansion of ethanol production at the One Earth facility, with completion expected in 2026[5] - Capital expenditures related to the One Earth carbon capture and sequestration project and ethanol production expansion totaled $155.8 million, with a combined budget of $220-$230 million for completion[7] Sales and Operational Performance - REX achieved consolidated ethanol sales volumes of 78.4 million gallons in Q3 '25[8] - The company has maintained positive earnings for 21 consecutive quarters, indicating strong operational performance[10] Strategic Opportunities - REX is evaluating opportunities to leverage 45Z tax credits to enhance shareholder value as its projects advance[10] Non-Cash Activities - Non-cash investing activities accrued capital expenditures of $5.235 billion, compared to $3.275 billion previously[21] - Non-cash financing activities accrued stock awards amounted to $3.392 billion, up from $1.648 billion[21] - Non-cash financing activities accrued excise taxes on stock repurchases totaled $258 million, with operating right-of-use assets acquired and liabilities incurred upon lease execution at $3.007 billion[21]

Group 1 - The article does not provide any specific content or key points related to a company or industry [1]