Sector Snap: Bargain Hunt Helps Ethanol
Wednesday March 5, 12:38 pm ET
Ethanol Stocks Propelled by Bargain Hunters Following Sell-Off, Despite Higher Corn Prices
NEW YORK (AP) -- Some ethanol stocks benefited from investors' bargain hunting on Wednesday after getting hammered down the day before due to surging corn costs.
Verenium Corp. sailed higher after saying it has hired Janet Roemer as executive vice president of specialty enzymes. Roemer, 52, was chief of staff at BP PLC's Innovene division and led one of its business units.
The Cambridge, Mass., ethanol producer's shares rose 16 cents, or 5.6 percent, to $3.01 in midday trading.
Pacific Ethanol Inc. gained 24 cents, or 5.2 percent, to $4.83; Cosan Ltd. rose 39 cents, or 2.6 percent, to $15.53; and Archer-Daniels-Midland Co. rose 58 cents to $46.58.
Despite the rally, corn futures for March delivery moved back toward a record reached earlier in the week, trading 11.5 cents higher on Wednesday at $5.545 a bushel. The contract reached an all-time high of $5.615 a bushel in Monday trading on the Chicago Board of Trade, but fell on Tuesday.
Lehman Brothers analyst Mansi Singhal lowered price targets and earnings forecasts for Verasun Energy Corp. and Aventine Renewable Energy Holdings Inc. on Wednesday, saying that higher assumptions for ethanol prices failed to outweigh higher assumptions for corn prices.
Verasun shares rose 8 cents to $7.83 as Aventine dropped 2 cents to $6.09
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