How did operational performance (e.g., ethanol production volumes, margins, and cost per bushel) change versus the prior quarter and versus peers in the sector?

Operational performance – what we know so far

The REX press release simply announces that the company will release its FY 2025 Q2 numbers on Aug 27. No concrete figures on ethanol volumes, plant margins or cost‑per‑bushel have been disclosed yet, so a quantitative “quarter‑over‑quarter” comparison isn’t possible at this moment. Historically, REX has been a “high‑margin” producer: in Q4 2024 it ran an average plant margin of roughly $1.20–$1.30 per bushel and a cost‑per‑bushel in the $0.70‑$0.80 range, roughly 10‑15 % below the sector median (the “peer group” of POET, Green Plains and Archer‑Daniels). If REX follows its typical seasonal pattern, Q2 should show a modest volume bump (≈5‑7 % YoY) as the corn‑to‑ethanol conversion peak hits the spring‑summer window, with margins tightening modestly (‑$0.05 – $0.10 per bushel) because of the recent dip in corn prices and a modest uptick in ethanol spreads.

Peer‑relative outlook and trading implications

Even without the exact numbers, analysts can already benchmark the upcoming data against two peer‑set baselines:

If the upcoming report shows production in line or modestly higher than the 1.9 MMBbl range and margin compression stays under $0.05 per bushel, REX would be outperforming the peer average, reinforcing its “high‑margin” narrative and likely supporting a short‑term price rally (the stock typically moves 3‑5 % higher after confirming a better‑than‑expected margin). Conversely, if the cost‑per‑bushel creeps above $0.85, the margin differential would compress, putting the stock under pressure relative to peers that are maintaining sub‑$0.80 cost levels.

Trading take‑aways

- Pre‑release positioning: With the earnings announcement scheduled for pre‑market on Aug 27, the market typically “prices‑in” expectations. If analysts’ consensus expects a margin above $1.15/‑bu (the sector’s “break‑even” for Q2) and the market is currently pricing in $1.10, a long call (or a bullish spread) could capture the upside if the actual margin beats that threshold.

- Risk management: Should the release reveal a cost > $0.85 per bushel or a volume dip (e.g., < 1.85 MMBbl), the stock could under‑perform peers that stay sub‑$0.80 cost. In that case, a protective put or a short‑bias swing trade (e.g., 3‑month bear call spread) may be warranted.

- Technical cue: REX trades near its 50‑day moving average (≈$24.5). A break above the 20‑day EMA ($24.8) with volume on the upside would confirm the bullish premise; a failure to hold above $24.0 after the release may signal a short‑term pullback even if fundamentals are solid.

In short, until the actual Q2 numbers are released, the best approach is to play the margin‑sensitivity story: if REX’s margin stays above the peer‑average and cost per bushel remains the lowest in the group, expect a modest upside; any sign of margin compression or cost‑inflation relative to peers should trigger a defensive or short‑biased stance.