Following a recommendation from Wall Street analysts, a share of Vertex Energy Inc. (VTNR) climbed over 5.89% to $5.21 on December 1. The firm, according to analysts, has a lot of promise in the oil refining sector.
Vertex Energy is a petroleum product refiner and marketer, as well as one of the major used engine oil recyclers in the United States. Credit Suisse analysts upgraded the stock’s outlook to “above market” on Wednesday, December 1, and boosted their target price to $13, representing a more than 160 percent rise over the current price.
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Vertex Energy Inc. (VTNR)’s growth potential is seen by Credit Suisse as a result of the continuing transition. The company is attempting to sell its main engine oil refining assets to Safety-Kleen in order to focus on sustainable diesel fuel, with the Royal Dutch Shell plant in Alabama being purchased by early 2022.
The introduction into the renewable energy industry, according to Credit Suisse analysts, provides a significant “revenue growth opportunity.” When the Alabama refinery reaches its goal production capacity of 14,000 barrels per day by mid-2023, the company’s renewable diesel division may produce EBITDA of $195 million.
Vertex Energy Inc. (VTNR) has already raised $133.9 million for new projects since November. However, this money is inadequate to cover the cost of the new refinery’s acquisition, therefore the business plans to borrow another $250 million to cover the cost of the acquisition and following capital expenditures.
Meanwhile, huge regulatory barriers remain in the way of Safety-desire Kleen’s to sell its current holdings. Thus, Vertex Energy Inc. (VTNR) has the potential to develop, but it must first address a number of organizational and financial issues. The manufacturer’s growth prospects will become more definite once the barriers to expansion are removed.
VTNR stock rose 15.78 percent this week, with a monthly gain of 2.16 percent. It had a quarterly price performance of -29.78 percent, and a trailing twelve-month price performance of 647.49 percent.