In this article, we will discuss: 12 Best Ethanol Stocks to Buy According to Hedge Funds.
Ethanol stocks are from companies that manufacture, sell, or distribute ethanol, a biofuel derived from crops such as corn and sugarcane. The ethanol industry is booming. As per Precedence Research, the global fuel ethanol market stood at $106.20 billion in 2024, climbed to $111.64 billion in 2025, and is anticipated to exceed $174.98 billion by 2034, representing a 5.12% CAGR between 2024 and 2034. The North American ethanol market is estimated to be worth $60.53 billion in 2024, growing at a CAGR of 5.20% over the forecast period.
Overall, the United States is the world’s leading producer and exporter of fuel ethanol, and prices in the country stayed relatively low in 2024. Moreover, Brazil is the second-largest producer and exporter. Growth Energy, the nation’s largest biofuel trade association, released data revealing that ethanol exports from the US set a new high in 2024. In total, the country exported 1.9 billion gallons of ethanol valued at $4.3 billion in 2024, breaking the previous record for volume set in 2018 and the prior record for value established in 2023.
Growth Energy CEO Emily Skor commented:
“The numbers don’t lie. The world is looking to the U.S. to meet its fuel needs and American producers are delivering in a way that supports economic growth abroad and at home in rural communities across the country,” “As the new Administration puts its new trade priorities into action, we look forward to working with President Trump and his team to ensure that we build on this momentum in a way that continues to grow the American farm economy through sales of American ethanol abroad.”
Recently, the U.S. Energy Information Administration reported on April 2 that the output of fuel ethanol in the US rose by 1% in the week ending March 28. Stocks of fuel ethanol were down 3%, whereas exports dropped 62%.
Most importantly, the export market remains the most attractive opportunity for driving US ethanol demand in 2025. Looking ahead, according to Jacqui Fatka, a farm supply and biofuels economist at CoBank, ethanol usage in higher-level blends is anticipated to surge annually in the US, but it accounts for just a tiny fraction of total ethanol demand due to the market’s size. Therefore, without large expenditures in infrastructure that allow retailers to adjust pumps or signage, nationwide E15 sales will not significantly increase in the time to come. Currently, the export market represents the best possibility to boost demand in 2025.
According to the United States Department of Agriculture’s most recent quarterly trade projection, announced on February 27, ethanol export volumes in the US would hit a record 1.85 billion gallons in the fiscal year 2025. The forecast is slightly higher than the previous quarter’s outlook.
With that said, here are the 12 Best Ethanol Stocks to Buy According to Hedge Funds.
Farmers harvesting corn in a field, reminding us of the importance of the company’s ethanol production.
Our Methodology
We sifted through online rankings to form an initial list of 20 Ethanol stocks. From the resultant dataset, we chose the top 12 stocks most favored by hedge funds, using Insider Monkey’s database of 1,009 hedge funds in Q4 2024 to gauge hedge fund sentiment for stocks. We have used the stock’s Market Cap as of April 3, 2025, as a tie-breaker in case two or more stocks have the same number of hedge funds invested.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12. Alto Ingredients, Inc. (NASDAQ:ALTO)
Number of Hedge Fund Investors: 10
One of the Best Ethanol Stocks, Alto Ingredients, Inc. (NASDAQ:ALTO) manufactures specialty alcohol and essential ingredients. The company is divided into three segments: marketing and distribution, Pekin Campus production, Western production, and others.
It operates a network of ethanol production facilities throughout the United States. The company’s annual production capacity is 350 million gallons. This establishes it as a major player in the ethanol industry. Alto Ingredients, Inc. (NASDAQ:ALTO) produces revenue by selling ethanol and its byproducts, such as distillers grains and corn oil, which are utilized in various industries, including fuel, feed, and chemicals.
Alto Ingredients, Inc. (NASDAQ:ALTO) appears to gain from growing ethanol demand, both domestically and globally. The growing usage of E15 fuel in the US, which contains 15% ethanol rather than the usual 10%, is already driving up demand. On the export front, Europe, Japan, and other countries are increasing their ethanol blend ratios. Furthermore, ethanol’s significance as a crucial feedstock for the developing sustainable aviation fuel market provides an additional potential opportunity. Tax credits and investments in Carbon Capture and Storage can stimulate even more growth.
On January 1, 2025, Alto Ingredients, Inc. (NASDAQ:ALTO) announced that Kodiak Carbonic had been bought by its wholly owned subsidiary, Alto Carbonic, for $7.25 million in cash plus working capital. The purchase includes an upgraded, long-term contract for the sale of beverage-grade CO2, which will immediately add to the bottom line, has an appealing payback timetable, and offers an opportunity for future expansion.
11. Gevo, Inc. (NASDAQ:GEVO)
Number of Hedge Fund Investors: 11
Market Cap as of April 3, 2025: $262.18 million
A Colorado-based business, Gevo, Inc. (NASDAQ:GEVO) focuses on turning renewable energy into energy-dense liquid hydrocarbons that can be used as renewable fuels. The company’s offerings include renewable gasoline and diesel, sustainable aviation fuel, renewable natural gas, and ethanol, along with animal feed and protein. The firm is a pioneer in the conversion of agricultural feedstocks, specifically corn, into protein and ethanol, which is then refined into high-value products like jet fuel. It operates an ethanol plant with an adjacent CCS facility, cementing America’s leadership in energy innovation and making it among the Best Ethanol Stocks.
Gevo, Inc. (NASDAQ:GEVO) revealed the acquisition of Red Trail Energy’s low-carbon ethanol and carbon capture sequestration facilities in North Dakota, which is scheduled to close in Q1 2025. Moreover, the company was given two patents for its groundbreaking ethanol-to-olefin technology, further strengthening its technological accomplishments.
The predicted LCFS approval in Q1 2025 could drive RNG revenue, with 366,557 MMBtu sold in 2024 producing $15.1 million in environmental benefits. In Q4 of 2024, project development expenditures jumped by $3.4 million, displaying an investment in Alcohol-to-Jet and Verity. The hiring of qualified individuals resulted in a $3.2 million hike in general and administrative expenses, which strengthened operations. Despite a $9.0 million increase in operational losses, acquisitions and future initiatives set Gevo, Inc. (NASDAQ:GEVO) up for long-term success.
10. REX American Resources Corporation (NYSE:REX)
Number of Hedge Fund Investors: 11
Market Cap as of April 3, 2025: $651.76 million
REX American Resources Corporation (NYSE:REX) works as a holding company that invests in alternative energy and ethanol production businesses. Its operating segments include ethanol and byproducts. The firm produces dried distillers grains, modified distillers grains, and non-food-grade corn oil. It is one of the best ethanol stocks to monitor.
REX American Resources Corporation (NYSE:REX) saw a surge in ethanol sales for the fiscal year 2024, hitting 289.7 million gallons from 285.9 million gallons in 2023. Fourth-quarter ethanol sales reached 74.7 million gallons from 72.1 million gallons. Its carbon capture project in Gibson City, Illinois, made significant strides in the capture and compression stages, pending the required sequestration licenses.
In addition to capacity growth, REX American Resources Corporation (NYSE:REX) is carrying out important progress on its carbon capture and compression (CCS) project at the One Earth Energy facility. The CCS project aims to reduce carbon emissions from the ethanol production process. The carbon capture and compression phase of the project is nearly finished, and the business is waiting for the final approval of Class 6 injection wells from the Environmental Protection Agency, which is expected in July 2025.
The firm actively pursued its share repurchase program, purchasing 373,000 shares in Q4 2024 and an additional 282,000 shares in Q1 2025, with the Board approving the purchase of 1.5 million further shares. REX American Resources Corporation (NYSE:REX) had a healthy cash position at the end of the year, with $359.1 million in cash, cash equivalents, and short-term investments, despite capital expenditures and share buybacks. Moreover, interest and other revenue jumped by 22%, rising to $19.2 million in 2024 from $15.7 million the previous year.
9. Ultrapar Participações S.A. (NYSE:UGP)
Number of Hedge Fund Investors: 11
Market Cap as of April 3, 2025: $3.31 billion
Ultrapar Participações S.A. (NYSE:UGP) ranks ninth on our list of Best Ethanol Stocks. It invests its own capital in services, commercial, and industrial operations by subscribing to or acquiring shares of other firms. The company operates three business segments: gas distribution, fuel distribution, and storage. Ultragaz (gas distribution segment) sells LPG to residential, commercial, and industrial customers, mostly in Brazil’s South, Southeast, and Northeast areas. The fuel distribution segment distributes and markets gasoline, ethanol, diesel, fuel oil, kerosene, natural gas for automobiles, and lubricants, as well as other associated activities, throughout Brazil. The storage section operates liquid bulk terminals mostly in Brazil’s Southeast and Northeast regions.
Total revenue was R$35,401 million, up 6% from Q4 2023, owing primarily to greater revenues from Ipiranga and Ultragaz. In comparison to Q3 2024, net sales remained steady. In 2024, net revenues reached R$133,499 million, a 6% increase over 2023. Ultrapar Participações S.A. (NYSE:UGP) continued to invest in development. The firm invested in new Ultracargo ports and infrastructure projects in Ipiranga.
The company retained solid operational cash flow, generating R$3.736 million, allowing for expanded investments while keeping financial debt at manageable levels. Furthermore, the Board of Directors approved dividend payments totaling R$769 million, which shows Ultrapar Participações S.A. (NYSE:UGP)’s devotion to providing value to shareholders.
8. Cosan S.A. (NYSE:CSAN)
Number of Hedge Fund Investors: 14
Cosan S.A. (NYSE:CSAN) provides a variety of services in the energy and logistics sectors. Its reportable categories are Raizen, Compass, Moove, Rumo, and Radar. Most of its revenue comes from Raízen, which is involved in the production, commercialization, and trading of ethanol and bioenergy; the resale and trading of electricity from renewable sources; and the marketing and trading of sugar, fuels, and lubricants. The company is known for its E2G technology, which converts sugarcane waste into high-quality ethanol, making it on our list of the best ethanol stocks.
Cosan S.A. (NYSE:CSAN) reported mixed performance in Q4 2024. The company recorded an EBITDA of around BRL 30 billion ($5.1 billion). Despite the positive EBITDA, the firm reported negative earnings of BRL 900 million in 2024. The firm attributed the mixed financial performance predominantly to the devaluation of its shares and the depreciation of the Brazilian Real. The selling of Vale shares lowered the company’s debt by 40%. Its goal with this action was to improve its capital structure.
Dividends and interest on capital received grew to R$4.3 billion in 2024, owing primarily to Compass’s successful resolution of a tax lawsuit issue, a significant rise over 2023 levels. In the fourth quarter, Rumo also set records for both transported volumes and tariffs. This year, Cosan S.A. (NYSE:CSAN) management has committed to strengthening the company’s capital structure. The business intends to pursue similar transactions all year long in addition to the Vale divestment.
7. Adecoagro S.A. (NYSE:AGRO)
Number of Hedge Fund Investors: 17
Adecoagro S.A. (NYSE:AGRO) is a leading South American agricultural company. Its operations include the production of energy, sugar, ethanol, land transformation, dairy operations, and the cultivation of crops and other agricultural products. The business is divided into three segments: Land Transformation, Sugar, Ethanol and Energy, and Farming. In the Ethanol and Energy segment, sugarcane is grown and then processed in owned sugar mills to produce ethanol. The stock is up by more than 15% YTD, making it among the best ethanol stocks.
The goal of Adecoagro S.A. (NYSE:AGRO) is to maximize the production of Hydrous Ethanol, a blend of ethanol and water used in automobiles and for industrial uses. The firm has been aggressively growing its capacity to produce ethanol. The company’s strategic focus on Hydrous Ethanol is fueled by higher margins and an increasing preference for this product over other types of ethanol.
Adecoagro S.A. (NYSE:AGRO)’s revenue jumped 41.8% year over year in Q4 2024 due to record-breaking sugar production, which produced 832,000 tons of sugar with a 52.2% sugar mix and set a new crushing record. The dairy and rice industries also performed well due to stronger yields and higher selling prices. Without affecting debt or expansion plans, shareholder returns rose dramatically in 2024, with $102 million distributed, which was $32 million more than the distribution policy. A further indication of better operational efficiency was the cash costs, which decreased to 12.7 cents per pound of sugar equivalent, an 8% decrease from the previous year.
The market forecast for ethanol is still attractive because of the advantageous pump parity compared to gasoline, which creates an appealing price environment and strong demand.
6. The Andersons, Inc. (NASDAQ:ANDE)
Number of Hedge Fund Investors: 21
One of the Best Ethanol Stocks, The Andersons, Inc. (NASDAQ:ANDE) is a diverse firm that operates in the trade, renewables, nutrient, and industrial sectors in the United States, Canada, Mexico, Egypt, Switzerland, and globally. It buys and sells basic commodities and produces renewable fuels like corn-based ethanol. The company has four ethanol plants, all of which are strategically located in the Eastern Corn Belt, and generates ethanol for industrial and fuel uses.
This means that depending on the operational environment, the company’s top and bottom lines may vary significantly. Nonetheless, The Andersons, Inc. (NASDAQ:ANDE) has increased its earnings over time. The company’s 2022 and 2023 net incomes were $119 million and $101 million, respectively. In the first nine months of 2024, the net income was $69 million.
For many years, The Andersons, Inc. (NASDAQ:ANDE) has also consistently paid a dividend. After becoming public in 1996, the company announced its 113th consecutive dividend hike in late 2024.
Even though ethanol board crush margins decreased by $0.16 per gallon, The Andersons, Inc. (NASDAQ:ANDE)’s Renewables segment produced record amounts of ethanol in Q4 2024 due to better yields and lower controllable costs. Price deterioration was mitigated by a lower corn base, resulting in Q4 EBITDA of $40M and full-year adjusted EBITDA of $189 million. In 2025, higher ethanol pricing and better margins should be supported by increased corn acreage, seasonal demand, and industry maintenance cycles.
5. Green Plains Inc. (NASDAQ:GPRE)
Number of Hedge Fund Investors: 29
Green Plains Inc. (NASDAQ:GPRE) ranks fifth among the Best Ethanol Stocks on our list. It produces and markets ethanol and its byproducts in two functional segments. The majority of the company’s revenue is produced by the ethanol production area, which also produces sustainable corn oil, distillers grains, ethanol, and Ultra-High Protein. The agriculture and energy services section encompasses grain handling and storage, commodity marketing, and merchant trading of company-produced and third-party ethanol, distillers grains, Ultra-High Protein, renewable corn oil, natural gas, and other commodities.
Green Plains Inc. (NASDAQ:GPRE) decided to close its Fairmont, Minnesota operation in January 2025 as it deals with difficult market conditions. Furthermore, the firm announced on March 17, 2025, that it had decided to temporarily shut down its Clean Sugar Technology facility located in Shenandoah, Iowa. Green Plains’ plan to improve profitability by improving its product mix includes this step.
Green Plains Inc. (NASDAQ:GPRE) has already implemented $30 million of its $50 million annualized cost savings strategy, which includes organizational transformation and leadership cutbacks. Exports of ethanol are predicted to increase further in 2025 and are on course to hit a record 1.9 billion gallons. Initiatives for carbon capture have advanced drastically, and the Tallgrass Trailblazer Project is scheduled to start CO2 capture in the second half of this year. Moreover, the business increased its market share in the aquaculture market by securing its biggest sale to date, which could lead to further growth. The firm concluded the year with $200.7 million available under its working capital revolver and $209.4 million in cash, displaying its solid liquidity position.
4. Bunge Global SA (NYSE:BG)
Number of Hedge Fund Investors: 38
Market Cap as of April 3, 2025: $10.45 billion
Bunge Global SA (NYSE:BG) is a food technology and ingredient developer, just like other midmarket supply chain companies. This part of the food industry is quite profitable. Its sales and profitability have fluctuated since its 2001 U.S. initial public offering, but it has managed to keep raising its dividend over time. The firm’s Sugar and Bioenergy section manufactures sugar and ethanol and generates electricity by burning sugarcane bagasse, ranking it fourth on our list of the Best Ethanol Stocks.
Bunge Global SA (NYSE:BG) is nearing the end of the regulatory procedures in China and Europe after receiving regulatory permission from the Canadian government for the Viterra deal. It is anticipated that the acquisition will build a $25 billion powerhouse that can compete with some of the top agricultural companies in the world. Furthermore, in FY 2024, the business declared that the sale of its Brazilian joint venture for sugar and bioenergy was completed.
Bunge Global SA (NYSE:BG) repurchased $1.1 billion of stock in 2024, showing a strong commitment to returning cash to shareholders. The company has a $3.3 billion cash balance at year’s end and $8.7 billion in unused committed credit facilities, revealing its strong liquidity position. As far as sustainability goes, the business made history by being the first international commodity exporter to guarantee 100% traceability as well as tracking of direct and indirect soy purchases in Brazil’s priority regions.
3. Archer-Daniels-Midland Company (NYSE:ADM)
Number of Hedge Fund Investors: 38
Market Cap as of April 3, 2025: $23.01 billion
Archer-Daniels-Midland Company (NYSE:ADM) is a leading processor of oilseeds, corn, wheat, and other agricultural products. The company’s vast network of logistical assets allows it to store and ship grains all over the world, making it one of the biggest grain merchandisers. The firm also operates a nutrition company that specializes in both human and animal ingredients and is a major manufacturer of ethanol, starches, and sweeteners made from corn, which makes it among the Best Ethanol Stocks
Before selling the crops to consumers of food, feed, and energy, the company buys them from farmers and then transports, stores, and/or processes them. Archer-Daniels-Midland Company (NYSE:ADM)’s profit margins are narrow since its competitors’ commodity products are easily accessible, and it has little control over the prices of the products it purchases and sells. Furthermore, the firm finds it challenging, though not impossible, to turn a profit due to the capital intensity of its operations.
Archer-Daniels-Midland Company (NYSE:ADM) reported Q4 2024 adjusted EPS of $1.14 and full-year adjusted EPS of $4.74, in line with expectations. In the fourth quarter, the total segment operating profit was $1.1 billion, and for the entire year, it was $4.2 billion. The company effectively ramped up the Spiritwood facility, strengthened North American operations, and elevated crush volumes in canola and rapeseed. Production output increased by 3% year over year due to strong plant performance, and multiple North American product lines saw record operating profits. Along with developing biosolutions and health and wellness innovations, the business further improved its safety record by cutting process safety incidents by more than 35%. A quarterly dividend increase was also announced by the company, which has now paid dividends for 93 years in a row.
2. BP p.l.c. (NYSE:BP)
Number of Hedge Fund Investors: 44
BP p.l.c. (NYSE:BP) is among the Best Ethanol Stocks and the most integrated oil and gas companies globally. The business has been aggressively moving toward a low-carbon and more sustainable future by focusing on renewable energy sources, such as biofuels like ethanol and biogas, as well as other sustainable energy alternatives. Its commitment to achieving carbon neutrality by 2050 is a positive beginning.
Strong capital returns were shown by BP p.l.c. (NYSE:BP), which announced $7 billion in share buybacks, including $1.75 billion revealed in Q4 2024, and raised its dividend per share by 10%. The company’s Plant reliability exceeded 95%, while upstream output rose 2% year over year to 2.36 million barrels per day.
Significant strategic advancements were accomplished by the firm, including the acquisition of ten new final investment decisions, expansion into India and Iraq, the sale of tail assets in Trinidad, and the withdrawal from the Empire Wind project offshore in the United States. Furthermore, BP p.l.c. (NYSE:BP) was able to reduce structural costs by $750 million in Q4 2024.
1. Valero Energy Corporation (NYSE:VLO)
Number of Hedge Fund Investors: 52
Valero Energy Corporation (NYSE:VLO) is the Best Ethanol Stock. It is among the biggest independent refiners in the US. It runs 15 refineries in the US, Canada, and the UK, with a daily throughput capacity of 3.2 million barrels. The firm also has 12 ethanol plants with a combined capacity of 1.6 billion gallons per year, as well as a 50% investment in Diamond Green Diesel, which can create 1.2 billion gallons of renewable diesel annually.
Its financial performance has been under pressure due to the recent decline in refining margins and rising operating expenses. Nonetheless, through initiatives like the Sustainable Aviation Fuel program, the business is still committed to improving its renewable energy capabilities. The operating income of Valero Energy Corporation (NYSE:VLO)’s largest category, refining, decreased to $437 million in Q4 2024 from $1.6 billion the year before. However, renewable diesel was a standout, increasing its operating income from $84 million in Q4 2023 to $170 million, in part because of higher sales volumes and improved margins. The ethanol sector saw a dramatic decline, generating only $20 million in revenue as opposed to $190 million.
Valero Energy Corporation (NYSE:VLO) remains well-positioned for almost any market condition due to its high-quality refining assets and location, which allows for greater feedstock flexibility. The business has always had an advantage because of its more efficient system of 15 refineries, which enables it to turn lower-quality feedstock into a high-value output. It shifted to processing larger quantities of high-quality discounted domestic crude by replacing imported crude with local, building more light crude processing capacity, and investing in transportation infrastructure as domestic light crude discounts emerged.
Overall, VLO ranks first among the 12 Best Ethanol Stocks to Buy According to Hedge Funds. While we acknowledge the potential of ethanol companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than VLO but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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