17. November 2021 | 14:03 CET
Airbus, Kleos Space, Secunet Security Networks: Where analysts see 600% returns
Data is the raw material of the 21st century. Almost everyone has read this sentence at least once. But what is the truth behind the mantra of tech-savvy journalists and visionaries? The fact is that today, thanks to sensors and satellites, we can collect data both below and above ground. In mining, for example, sensors ensure that problems in the mine are detected early on, and productivity can be kept high. In the atmosphere and space, aircraft and satellites collect a wide range of data on weather and activities on Earth. This data flows into climate research, border protection or the fight against smugglers. We present three companies that are taking innovative approaches to the raw material of the 21st century.
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ISIN: AIRBUS | NL0000235190 , KLEOS SPACE CDI/1/1 | AU0000015588 , SECUNET SECURITY AG O.N. | DE0007276503
Airbus: Top dog relies on innovations
Most people know Airbus as the aviation group that, alongside Boeing, holds a leading position in the production of modern passenger and cargo aircraft. But Airbus also stands for activities in space. Both the Ariane rockets and the associated satellites come from Airbus. Since the Group is also active in the field of armaments, which are increasingly being shifted into orbit, Airbus can profit doubly from its activities in space. After all, more and more civilian projects are also launching satellites into space. Overall, the armaments/space segment accounts for around 20% of Airbus' revenues. Helicopters account for a further 12.5%, and the rest is accounted for by the aircraft as mentioned above.
The Group got back on track after a weak Corona year in 2020 and achieved solid results in recent quarters. In addition to good business with helicopters, things went particularly well in space. A restructuring program initiated some time ago also had an impact and is now bearing fruit. At the same time, Airbus is committed to innovation and plans to launch an emission-neutral hydrogen-based aircraft by 2035. Since hydrogen only remains liquid when strongly cooled, it looks as if the future aircraft will no longer be able to transport their fuel in the wing - new designs would therefore be necessary. This is currently still a challenge. The bottom line is that Airbus is a solid stock that operates in several exciting areas. However, the share is unlikely to become a high-flyer any time soon.
Kleos Space: Data from space and a scalable business model
The situation is somewhat different at space startup Kleos Space. The Company has already launched several satellite clusters into orbit, collecting data on radio frequency transmissions on Earth. The Company uses this data to alert shipping companies to impending pirate attacks, for example, or to inform border guards about the activities of smugglers. Since Kleos Space's offering is unique and there are various use cases for it, the Company is already expecting numerous new customers in the coming months. Some 52 customers are already on board, and Kleos Space is in close contract talks with a further 100, according to analysts at First Berlin.
The experts at the analyst firm rate Kleos Space's business model as "very scalable", as data only needs to be collected and processed once but can be sold multiple times. First Berlin also emphasizes that there are many potential sources of revenue. In addition to shipping and border guards, the experts also cite insurance companies and civil aviation as examples. The analysts see their price target at AUD 5, a potential return of almost 600% compared to current prices. The analysts assess the potential risk as "high" but emphasize that they believe it is possible that Kleos Space can grow strongly for several years.
Secunet Security Networks: Wait for reassurance
While Kleos Space is largely alone with its business model in space, things are quite different for Secunet Security Networks. The Company specializes in IT security solutions and also offers encryption technology for satellite communications. Potential customers in the field include armed forces, while classic IT security solutions are more likely to be available to industry or public authorities. The share price of Secunet Security Networks recently fell sharply, with a double-digit drop. The background to this was a sales warning for the coming year, with the Company itself no longer expecting such buoyant demand for mobile workstations. In recent years, this had boosted the IT sector. Although analysts reacted negatively, they only lowered their thumbs slightly - the price targets mentioned are still above the current price level. IT security will remain an issue in the future. Secunet is perfectly positioned with activities on and above the ground. However, from an investor's perspective, it is advisable to wait for the market to calm down.
While stocks like Secunet have attracted many investors in recent years, the equity story around Kleos Space is only gradually developing. Many investors are likely to be skeptical of small-cap stocks with a focus on space. But the Company has already launched several satellite clusters into orbit and is benefiting from falling space prices. Its business model is unique, and its applications diverse. Unlike established stocks like Airbus, Kleos Space also promises 100% exposure to space and higher growth rates. The share is worth considering for speculative investors.