Week 161: Earnings so far – Pacific Ethanol and my other ethanol plays
I agreed to this deal with Seeking Alpha where they post my articles from the blog and I don’t have to do anything. Its a pretty fair deal; the reason I never published them before had more to do with me being lazy then anything else. The only downside is that everything I write will get posted and I don’t want everything I write to get posted because much of what I write is blog-worthy but not publishing-worthy. Sometimes I just want to post my thoughts here, and not have to reference and review every data point to make sure I have all my t’s crossed. Therefore I created a simple rule whereby if I put the words Week XX in the title of my post they do not get published on Seeking Alpha. And that is the long winded, paragraphical description of why I continually make the rather banal observation of how many weeks I have been writing this blog in the title of so many posts.
With that out of the way, lots of earnings reports for companies I own came out this week and I am going to give my thoughts on a few of them. We will start with the biggest of the bunch, at least in terms of my own P&L: Pacific Ethanol and my other ethanol plays.
Pacific Ethanol
This is a very large position for me and so obviously I was paying close attention to their report on Thursday. I was a little surprised that the earnings per share number was below a buck. It turns out that I had missed a couple things.
First, I didn’t realize that the company wasn’t able to utilize their net operating losses (NOLs) in the second quarter and would therefore have to pay tax. This was mentioned in the Q1 10-Q but I didn’t read through the details carefully enough. So the company was taxed at 30% and that was a big reason the earnings per share number did not hit the magic $1 mark that I had expected. Read more
Reminiscences of a Stockblogger 