REX American Resources (REX) Completed A Large Buyback, Is It Still A Bargain?

REX American Resources event overview

REX American Resources (REX) has updated investors on a completed share repurchase program totaling 3,679,615 shares for US$66.99 million, along with fresh quarterly earnings for the period ended July 31, 2026.

REX American Resources shares trade at US$41.62, with the price slipping 6.66% over the past month and 3.14% over 90 days, while still posting a 28.46% year to date share price return and a 5 year total shareholder return of 238.83%. This indicates that long term momentum remains intact despite some cooling in the near term as investors digest the recent earnings update and the completed buyback.

Scan for other ethanol and energy producers showing similar earnings momentum and capital return programs through the hand picked 15 high quality undiscovered gems.

REX American Resources just paired stronger recent earnings with a sizeable buyback completion. The business case appears solid. The open question is whether the current US$41.62 share price fairly reflects that strength.

Price-to-earnings of 11.5x for REX American Resources: Is it justified?

REX American Resources changes hands at $41.62, which equates to a P/E of 11.5x, a level that screens as relatively low compared with both peers and the wider US Oil and Gas group.

The P/E ratio compares what investors are currently paying for each dollar of reported earnings. For a producer focused on ethanol and by products, earnings power often swings with commodity spreads and plant utilization, so the multiple becomes a quick shorthand for how much faith the market is putting in those profits holding up.

Here, the current 11.5x P/E is flagged as good value compared with a peer average of 26.6x. That gap suggests the market is assigning a materially lower price tag to each dollar of REX American Resources earnings than to similar companies, even though REX is reporting high quality earnings, a net profit of $120.56m on $684.54m of revenue, and net profit margins currently above last year. Relative to the broader US Oil and Gas industry average P/E of 13x, the stock again comes through as cheaper, which points to investors pricing in more caution on future profitability than the sector snapshot implies.

The preferred multiple here is the P/E ratio, and on both peer and industry comparisons, the current 11.5x level looks like a discount rather than a premium. Result: Price-to-earnings of 11.5x (UNDERVALUED).

See what the numbers say about this price — find out in our valuation breakdown.

Still, the REX American Resources story can be knocked off course if commodity spreads compress sharply or if US ethanol policy shifts in a less supportive direction.

Find out about the key risks to this REX American Resources narrative.

Another view on REX American Resources valuation

The P/E comparison paints REX American Resources as inexpensive, yet the SWS DCF model goes much further. On that framework, the shares at $41.62 trade at roughly a 56% discount to an estimated future cash flow value of $93.68, which points to a very different risk reward balance.

This kind of gap can tempt value hunters, but it also raises a practical question for you as an investor. Is the market correctly discounting future cash flows, or is it mispricing a company whose recent 134.6% earnings growth and 17.6% net margin are already on the table?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out REX American Resources for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 32 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Plenty of signals around REX American Resources point in different directions, so move quickly to test the numbers yourself, weigh both the concerns and the upside, and then zero in on the 2 key rewards and 1 important warning sign.

Looking for more investment ideas beyond REX American Resources?

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• Target potential mispricings by scanning companies that screen as undervalued today through the 32 high quality undervalued stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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