Cleaner fuel provider Renewable Energy has partnered with Optimus Technologies to deliver B100 (100% biodiesel) to its fleet customers. Optimus’ fuel system technology allows diesel engines to operate on 100% biodiesel.
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Renewable Energy (REGI) Senior Vice President, Sales and Marketing, Bob Kenyon, said, “Delivering sustainable fuel directly to customers is a key element of REG’s downstream strategy and it is exciting to see the demand growing for B100.”
Kenyon added, “It has been common in the past to see fleets utilizing blends of B5 to B20 in their fleets, but the capability of offering B100 as a finished fuel is an attractive lower carbon fuel solution for our customers.” (See Renewable Energy stock analysis on TipRanks)
Along with supplying B100 fuel, Renewable Energy will also provide infrastructure such as storage tanks, dispensers and logistics solutions.
The B100 system helps fleets improve their emissions targets, with a vehicle add on that works in conjunction with diesel vehicle components. According to Renewable Energy, its biodiesel reduces carbon by up to 88%, compared to petroleum diesel.
On March 23, Piper Sandler analyst Ryan Todd reiterated a Buy rating on the stock with a $104 price target (57.5% upside potential).
Todd commented, “We view ERGI’s relative valuation as increasingly attractive (currently at a reasonable ~15% discount to DAR on 2022e EBITDA) and see an attractive entry point for both REGI and DAR (50%/33% upside to PT) with potential 2021 catalysts (Canada Clean Fuels adoption, US RVO guidance under Biden administration, increased renewable fuels funding, etc.) supporting tailwinds for the RD industry.”
Turning to the rest of the Street, the stock has a Strong Buy consensus rating alongside an average analyst price target of $96.63 (46.3% upside potential), based on 7 Buys and 1 Hold. Shares have gained about 221.7% over the past year.
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