UPDATE: Piper Jaffray Reiterates Overweight Rating, Lowers PT on Renewable Energy Group

In a report published Wednesday, Piper Jaffray & Co. reiterated its Overweight rating on Renewable Energy Group

, but lowered its price target to $9.00. Piper Jaffray noted, “Despite a strong 2Q, the uncertainty of the renewable volume obligation timing and increased pressure on margins should be headwinds for Renewable Energy Group in the back half of 2012 and into 2013. Demand for biodiesel is down because the 2013 RVO is unknown and it is not expected to be announced until Nov, but even that time frame is uncertain. Although there are some improvements in feedstock pricing, margins are contracting without a higher RVO to offset lower biodiesel demand and RINs pricing is dropping faster than improvements in feedstock costs. Management lowered its full year adjusted EBITDA guidance to reflect the difficult environment ahead and we are taking down our estimates for FY12 and FY13 and in-turn lowering our PT to $9. We maintain our Overweight rating as we believe the valuation of REGI shares does not reflect the earnings power of the business, particularly once the RVO is established for 2013.” Renewable Energy Group closed on Tuesday at $4.70.