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Benign Growth For Aemetis, Inc. (NASDAQ:AMTX) Underpins Stock's 31% Plummet

Simply Wall St · 08/08 10:47
NasdaqGM:AMTX 1 Year Share Price vs Fair Value
NasdaqGM:AMTX 1 Year Share Price vs Fair Value
Explore Aemetis's Fair Values from the Community and select yours

The Aemetis, Inc. (NASDAQ:AMTX) share price has softened a substantial 31% over the previous 30 days, handing back much of the gains the stock has made lately. The recent drop has obliterated the annual return, with the share price now down 5.8% over that longer period.

After such a large drop in price, Aemetis' price-to-sales (or "P/S") ratio of 0.6x might make it look like a buy right now compared to the Oil and Gas industry in the United States, where around half of the companies have P/S ratios above 1.6x and even P/S above 4x are quite common. Although, it's not wise to just take the P/S at face value as there may be an explanation why it's limited.

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View our latest analysis for Aemetis

ps-multiple-vs-industry
NasdaqGM:AMTX Price to Sales Ratio vs Industry August 8th 2025

How Has Aemetis Performed Recently?

For example, consider that Aemetis' financial performance has been poor lately as its revenue has been in decline. Perhaps the market believes the recent revenue performance isn't good enough to keep up the industry, causing the P/S ratio to suffer. However, if this doesn't eventuate then existing shareholders may be feeling optimistic about the future direction of the share price.

We don't have analyst forecasts, but you can see how recent trends are setting up the company for the future by checking out our free report on Aemetis' earnings, revenue and cash flow.

Do Revenue Forecasts Match The Low P/S Ratio?

There's an inherent assumption that a company should underperform the industry for P/S ratios like Aemetis' to be considered reasonable.

Taking a look back first, the company's revenue growth last year wasn't something to get excited about as it posted a disappointing decline of 7.5%. This has erased any of its gains during the last three years, with practically no change in revenue being achieved in total. Accordingly, shareholders probably wouldn't have been overly satisfied with the unstable medium-term growth rates.

Comparing the recent medium-term revenue trends against the industry's one-year growth forecast of 6.2% shows it's noticeably less attractive.

In light of this, it's understandable that Aemetis' P/S sits below the majority of other companies. It seems most investors are expecting to see the recent limited growth rates continue into the future and are only willing to pay a reduced amount for the stock.

What Does Aemetis' P/S Mean For Investors?

Aemetis' recently weak share price has pulled its P/S back below other Oil and Gas companies. Using the price-to-sales ratio alone to determine if you should sell your stock isn't sensible, however it can be a practical guide to the company's future prospects.

As we suspected, our examination of Aemetis revealed its three-year revenue trends are contributing to its low P/S, given they look worse than current industry expectations. Right now shareholders are accepting the low P/S as they concede future revenue probably won't provide any pleasant surprises. If recent medium-term revenue trends continue, it's hard to see the share price experience a reversal of fortunes anytime soon.

It is also worth noting that we have found 4 warning signs for Aemetis (2 don't sit too well with us!) that you need to take into consideration.

If you're unsure about the strength of Aemetis' business, why not explore our interactive list of stocks with solid business fundamentals for some other companies you may have missed.