AI needs more than chips: Power Metallic Mines, Siemens Energy and Micron under the investor spotlight!

Power Metallic Mines: On the way to the next milestone

The exploration company recently commissioned a preliminary economic assessment (PEA) for its flagship Nisk project, which covers the Nisk Main and Lion zones. The property, covering around 330 km² in the Canadian province of Québec, in which Power Metallic Mines holds an 80% stake, contains mineralisation with copper, palladium, platinum and other metals. The PEA results are expected in the first half of 2027. This is an important milestone for the company and its investors. The PEA can provide an indication of the value of the mineral deposits.

Particular attention is focused on the Lion deposit, with its near-surface, metal-rich mineralisation and further exploration potential at depth. The first Lion resource estimate in September delivered impressive data. It reports 4.145 million tonnes in the indicated category with an average copper equivalent grade of 3.86%. In addition, there are 0.601 million tonnes in the less certain inferred category with a copper equivalent grade of 4.01%.

The PEA is to examine mining and processing options, infrastructure, and capital and operating costs. A final development configuration has not yet been selected. Only the combination of metal grades, recovery rates, costs and schedule allows a more informed assessment of the project's value.

Metallurgy is equally important. In this regard, the Canadians have already delivered important results in the past. Two preliminary laboratory tests demonstrated recovery rates of more than 98% of the copper contained - a fantastic figure. The shares are currently trading at CAD 0.86, giving it a market capitalisation of just over CAD 200 million.

Siemens Energy: AI as a growth driver

As an infrastructure stock, Siemens Energy benefits enormously from the growing appetite for electricity. As a supplier of gas turbines, grid technology and wind turbines, the group benefits from the expansion of data centres. In the third quarter, Siemens Energy generated revenue of EUR 11.4 billion, an increase of 18.5% on the previous year's figure. Profit before special items reached EUR 1.62 billion.

The wind division, Siemens Gamesa, reported a positive quarterly result for the first time since 2022. Order intake of EUR 17.9 billion increased the order backlog to EUR 162 billion. For the current financial year, management forecast group profit of around EUR 4 billion. The annual results are due to be published on November 11. The outlook for margins and cash inflows in the core business, as well as statements on the stability of the wind energy division, will be particularly important. The shares have surrendered some of their gains this year, but analysts still see 50% upside over the next 12 months.

Micron: Record figures and no end in sight

Micron supplies RAM and flash memory for data centres, computers, smartphones and other applications. HBM, a stacked memory with a high data transfer rate, is particularly relevant to AI systems. It supplies powerful processors with data quickly. Greater computing power therefore also increases the demands on memory technology.

The Americans recently delivered record annual results with revenue of USD 133.2 billion and profit of USD 85.0 billion, or USD 74.33 per share. The group is also securing the memory boom for the long term. According to company estimates, 26 multi-year offtake agreements are expected to cover more than 35% of revenue through 2030. Customers have made financial commitments of USD 32 billion for this, predominantly in the form of cash deposits.

HBM production for 2027 has also already been largely allocated, and at significantly higher prices. At the same time, management expects tight supply for DRAM and NAND through 2028. The contracts improve predictability and can cushion cyclical risks; rising memory prices offer additional margin potential. Analysts remain positive on the shares and set an average price target more than 75% above the current level. The enormous projected earnings momentum is reflected in a P/E ratio of 5.1 and 4.3 for the current and next financial year, respectively.

Conclusion

The PEA will show the economic potential behind the polymetallic resource. Forward-looking investors can still position themselves early in Power Metallic Mines. Siemens Energy has a large order backlog and will soon present the results for the financial year just ended. Micron's operating momentum is excellent. This is reflected, among other things, in very low valuation multiples.