XOP - Alto Ingredients: Undervalued Over-Shorted Still Transforming

• Alto Ingredients has taken short-term windfalls from hand sanitizer demand and pivoted away from fuel ethanol production.
• Management has been much less promotional than peer Green Plains, which has seen its stock increase ~150% YTD vs Alto being flat.
• Despite being valued at a quarter of Green Plains market cap, Alto has a similar profitability profile that has been missed by the market.
• Numerous catalysts exist, including the sale of a plant, debt repayment, high short interest, expected earnings beat, carbon capture plans, and more.
• I expect Alto shares to trade over $10 once the market discovers their pandemic earnings power is sustainable.

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