Gevo (GEVO) is in focus after its North Dakota carbon capture facility issued more than 500,000 engineered carbon removal certificates, received an A rating from BeZero Carbon, and appointed Alex Clayton as Chief Carbon Officer.

Gevo’s recent carbon removal milestone and leadership changes have arrived alongside a 6.3% 1 day share price return and an 8.96% 7 day share price return. However, the 90 day share price return of an 11.34% decline suggests momentum has been uneven despite an 18.06% 1 year total shareholder return.

If this kind of low carbon fuels story has your attention, it could be a good moment to scan other high growth tech and AI stocks for fresh ideas in the broader energy transition theme.

With Gevo shares at US$2.19, trading at what screens as a low value score of 2 and a large discount to both analyst targets and intrinsic estimates, you have to ask: is this a mispriced decarbonization play, or is the market already baking in future growth?

Most Popular Narrative: 64% Undervalued

Simply Wall St's most followed narrative pegs Gevo's fair value at $6.08, a large gap to the recent $2.19 close that raises clear questions about what is baked into those assumptions.

Monetization and growth of high integrity carbon dioxide removal (CDR) credits and clean fuel production tax credits (CFPCs), enabled by Gevo's uniquely certified carbon sequestration site, provide new stable, high margin revenue streams and cost offsets that are expected to meaningfully lift recurring net income and reduce volatility.

Curious how that carbon credit engine feeds into the $6.08 fair value, using a 6.96% discount rate and ambitious growth and margin steps that the market is clearly debating.

Result: Fair Value of $6.08 (UNDERVALUED)

However, there are still clear watchpoints, including Gevo's reliance on government tax credits, as well as the heavy capital needs and execution risk around new fuel projects.

Another View: Price To Sales Paints A Tougher Picture

That 64% undervaluation signal sits awkwardly next to Gevo's current P/S of 4.3x, compared with 1.6x for the US Oil and Gas industry and 0.9x for peers and the fair ratio. If the market leans toward those lower anchors instead, the perceived discount could be far slimmer than it looks today.

Build Your Own Gevo Narrative

If you are not convinced by this take, or prefer to lean on your own view of the numbers, you can build a custom thesis in minutes with Do it your way.

A great starting point for your Gevo research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

Ready for more investment ideas?

If Gevo has sharpened your thinking, do not stop here, use the Simply Wall St screener to uncover fresh stocks that match your next move.

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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.