Renewable Energy Group will replace Synchronoss Technologies in the S&P SmallCap 600 prior to the open of trading on Tuesday, May 15, 2018. The Nasdaq has decided to suspend Synchronoss Technologies from its exchange due to noncompliance with listing requirements.
Renewable Energy Group has excellent growth metrics.
Looking at the last year, Renewable Energy Group shows strong growth in revenue. Revenue has grown by 12.32% in the last year. Measured over the last 5 years, revenue has been growing by 10.14% yearly.
Renewable Energy Group also has good valuation metrics. The Forward P/E ratio of 8 indicates a rather cheap valuation. The P/E ratio is 12 which also suggests the stock is cheap relative to earnings. The price to book ratio of REGI, again suggests the stock is cheap. It is trading at 0.69 times its book value. When comparing the price to book ratio of REGI to the average industry (Oil and Gas Refining and Marketing) price book ratio of 2.69, REGI is cheap. REGI is cheaper than 81% of the companies listed in the same industry. The company has an Enterprise Value to EBITA ratio of 4.33. When comparing the Enterprise Value to EBITDA ratio of REGI to the average industry ratio of 9.02, REGI is valued rather cheaply. REGI is cheaper than 86% of the companies listed in the same industry.
Renewable Energy Group Stock
REGI is currently showing a bull flag pattern. A bull flag pattern occurs when prices pull back slightly after a strong rise up. This may be a nice opportunity for an entry. However, it could also be a cup and handle pattern that is forming.
REGI presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at $13.81. Right above this resistance zone may be a good entry point. There is a support zone below the current price at $13.38, a stop order could be placed below this zone. Another positive sign is the recent Pocket Pivot signal (blue dot).
I give REGI stock a buy rating. Most analysts agree with my buy rating. Overall there are no sell ratings, 1 hold rating, and 2 buy ratings on the stock. The average price target is $15.33 which represents 11.5% upside from the current price.