REX American Resources (REX) Stock Slips Despite Record Profit And Cash Pile

REX American Resources stock slipped about 3% to US$41.62 after earnings, even though the quarter delivered another punchy step up in profitability. The company printed Q2 2027 basic earnings per share of roughly US$1.06 on revenue of about US$186.9m, an ethanol driven business putting up what management called a record second quarter. Trailing earnings still support a P/E of 11.4x and a price that sits well below one independent discounted cash flow estimate. The gap between share reaction and earnings strength is now the central question for investors.

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Q2 2027 Earnings Summary

• Revenue, Q2 2027 vs Q2 2026: US$186.9m vs US$158.6m (higher year on year)
• Net Income, Q2 2027 vs Q2 2026: US$34.9m vs US$7.1m (very large year on year increase)
• Basic EPS, Q2 2027 vs Q2 2026: US$1.06 vs US$0.22 (very large year on year increase)
• Trailing 12 Month Net Income Margin, Q2 2027 vs Q2 2026: 17.6% vs 7.9% (margin significantly higher)

Tired of wading through dense earnings releases and spreadsheets full of ethanol margin numbers? Get a clear, visual read on how REX American Resources compares by checking the full valuation picture in the company report for REX American Resources.

REX bullish story anchored in earnings and cash

For investors leaning positive, REX American Resources just put real numbers behind the renewable fuels narrative. Revenue moved to US$186.9m with net income of US$34.9m and basic EPS of US$1.06, all well above last year. Gross profit expanded sharply, even before Section 45Z tax credits, which then added a further US$18.4m. The company holds US$379.5m of cash and short term investments with no bank debt while self funding expansion and carbon capture projects. That combination of profitability and balance sheet strength supports a constructive view on the business model.

Bearish concerns on cyclicality and policy risk tested

The cautious view on REX American Resources focuses on commodity and policy exposure, and the latest numbers only partly ease that worry. Earnings benefited meaningfully from 45Z tax credits and strong crush margins, both tied to policy and spread conditions that can change. SG&A more than doubled to US$15.6m, helped by incentive awards after strong results. Share price performance has been soft over 30 and 90 days despite record profitability. Investors who see ethanol as a cyclical, policy reliant business can still point to that disconnect as a reason for restraint.

Review how reliant REX American Resources is on tax credits and crush margins, then scan our completed risk analysis for REX American Resources which shows 1 important warning sign

Stay Ahead With REX American Resources

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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