The Paris Climate Change Factor In Gevo, Inc. (NASDAQ: GEVO)


Gevo, Inc. (NASDAQ: GEVO) is in the business of producing bio-based alternatives to petroleum-based products. The company’s renewable products include biofuels and chemicals that can be used in place of products derived from fossil fuels. In that position, Gevo’s business model aligns with the letter and spirit of the recently signed Paris climate agreement.

About 200 nations met in Paris, France last year to agree on actions to help reduce global warming, thus coming up with the Paris climate agreement. Those nations again recently met at the UN headquarters to sign the Paris climate deal. What will now follow is for the signatories to ratify the agreement.

Among other things, the Paris climate deal addresses the issue of renewable fuel, which is Gevo, Inc. (NASDAQ: GEVO)’s area of interest. Nationals are required to step up efforts to power their economies with green energy, which may be derived from solar, wind and feedstock.

Alternatives for fossil fuel

Gevo, Inc. (NASDAQ: GEVO) stands to benefit from increased demand for renewable energy that can be used in place of petroleum-based fuels. The company already boasts a large portfolio of bio-based products that can be perfectly used in place of petroleum-based products. It continues to build its portfolio through a well-oiled R&D division and partnership programs.

Given that Gevo is already a well-known name in the renewable energy circles, it should be easy for the company to penetrate international markets quickly.

One of the sectors expected to see significant shifts with the implementation of the Paris climate deal is automotive. Gevo has a number of products for the automotive industry.

1Q2016 earnings

Gevo, Inc. (NASDAQ: GEVO) will report 1Q2016 earnings on May 12 after the close of markets.

4Q2015 earnings

Gevo, Inc. (NASDAQ: GEVO) generated revenue of $7.3 million in 4Q2015, down 23.2% from the corresponding quarter a year earlier. It logged EPS loss of $0.44. Decreases in production primarily tempered Gevo’s results in 4Q2015.

Nevertheless, Gevo successfully reined in on costs during the quarter and cost of goods fell by nearly $2 million.


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