Stonegate Capital Partners has updated coverage on Aemetis Inc. (NASDAQ: AMTX) following the company's second-quarter 2026 results, which revealed a visible operating inflection. Revenue increased 20% year-over-year and 15% sequentially to $62.7 million, slightly below consensus of $68.6 million, but the underlying performance was stronger than the revenue variance suggests. The quarter marked a significant turnaround in profitability, with gross profit improving to $13.5 million from a $3.4 million loss and adjusted EBITDA reaching $9.7 million compared to a negative $5.8 million in the prior year period.
The positive results were driven by quarterly 45Z credit recognition, higher renewable natural gas (RNG) production, and improved ethanol economics, which more than offset weaker revenue from India due to timing of OMC tenders. Dairy RNG remains the clearest growth driver, with sales volume increasing 38% year-over-year to 146,900 MMBtu and segment gross profit rising to $4.0 million from $0.9 million. Aemetis has seven approved LCFS pathways with an average negative carbon intensity of 380, which are improving credit economics. Additionally, six more pathways are nearing approval and two digesters are expected to be commissioned in the third quarter of 2026, providing further runway for higher production, profitability, and cash flow.
The Keyes earnings bridge continues to advance, with the Mechanical Vapor Recompression (MVR) system targeted for operation by year-end 2026. Management estimates this could generate approximately $32 million in annual value from lower natural gas usage and incremental LCFS and 45Z benefits. These operational improvements have the potential to materially strengthen the earnings profile beginning in 2027. However, the balance sheet remains a primary constraint, with only $1.0 million in unrestricted cash and $415.9 million in total debt. Refinancing progress is still crucial to translating operating improvements into durable free cash flow.
Stonegate Capital Partners, a capital markets advisory firm, provides investor relations and equity research services. The full announcement is available at Stonegate's website. Investors should consider the company's operational momentum against its financial obligations when evaluating AMTX as an investment.
