February 10th, 2022 | 13:40 CET
Alerio Gold, Aixtron, Siltronic - The signs point to growth!
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"[...] Both the geology and the infrastructure around the project make for a very attractive cost structure. We expect to be able to produce at 50% of the current gold price. [...]" Bill Guy, Chairman, Theta Gold Mines Limited
Alerio Gold - Good prospects
Experts widely agree that gold has already proven its strength as a crisis asset in the aftermath of the 2020 Corona Crash. At that time, the precious yellow metal rose to an all-time high of just over USD 2,000 per troy ounce. In the meantime, the price has settled around the USD 1,800 mark and entered a sideways movement. There are a few reasons for this. On the one hand, the recent announcements by the Fed in the direction of higher interest rates make gold no longer seem so attractive as an investment. On the other hand, there is currently no excess demand for the precious metal. Moreover, there are other alternative investment opportunities with attractive yield promises with cryptocurrencies.
But now the good news: Experts do not expect a price decline for gold in the short term but anticipate a further sideways movement at a high level. As a result, current exploration projects continue to promise good profitability. One example is the Canadian junior explorer Alerio Gold. The Company, listed on the Frankfurt Stock Exchange since November 22, 2021, is currently developing two 100%-owned gold projects in Guyana, a small, mineral-rich country in northeastern South America, where industry giants such as Barrick Gold and Newmont are already active.
The Company has already spent CAD 34 million on constructing a camp, a runway and a jetty for the Tassawinni/Sonne project. In addition, all necessary mining licenses have already been obtained for the project, which has resources of approximately 499,000 ounces of gold (indicated and inferred), according to a study conducted by SRK in 2009. In addition to continuing the exploration program to increase resources, Alerio plans to obtain an environmental impact statement and publish a PEA (preliminary economic analysis) study later this year. So positive newsflow should be provided. In addition, the Company recently announced that it has successfully closed the second tranche of a private placement of approximately CAD 150,000.
Aixtron - Nervous tech investors
What is going on at Aixtron, the global leader in MOCVD deposition equipment for the semiconductor industry? Actually, the starting position could not be better at the moment. The global chip shortage forces numerous semiconductor manufacturers to expand their production capacities. This is reflected in the order books of the North Rhine-Westphalian company: the order backlog increased by 80% in the first nine months of fiscal year 2021 compared to the same period of the previous year, sales revenues climbed by 54%, and gross profit by as much as 60%.
This prompted a large number of analysts to raise their forecasts for Aixtron. Stifel currently sees the price target as much as three euros higher at EUR 19 and changed its investment recommendation from "Sell" to "Hold". DZ Bank (price target: EUR 25, recommendation: Buy) and Barclays (price target: EUR 29, recommendation: Overweight) were even more optimistic. The main drivers are the increasing demand from the data center and 5G infrastructure sectors. However, all the positive prospects do not seem to be taking hold at the moment. The share has barely gained a few percentage points when tech investors, driven by the threat of interest rate hikes in the USA, caused prices to fall due to profit-taking. There is currently no sign of a new upward breakout. Investors are now eagerly awaiting February 24. On this day, Aixtron will present its figures for the past fiscal year.
Siltronic - Takeover by GlobalWafers collapsed
After the German Federal Ministry of Economics failed to issue a clearance certificate for the takeover of the Munich-based Siltronic Group, the world's third-largest manufacturer of wafers, by Taiwanese chip supplier GlobalWafers within the set deadline, the takeover is off the table. However, Siltronic's main shareholder, Wacker Chemie, also based in Munich, was not particularly disappointed. Although the takeover could have created a global market leader with strong European roots, the Company believes it is very well positioned on its own for the time being, especially given the current strong growth in demand for semiconductors.
Analysts share this opinion. The experts already see the Siltronic share at a price of EUR 160 (Jeffries, "buy") and EUR 135 (Berenberg, "buy"). On average, the analysts place the fair price at around EUR 145 - this is how much GlobalWafers were prepared to pay for a share at the end. Given the market data and the well-filled order books of the semiconductor specialist, shareholders should lean back and relax.
Who will benefit from the current macroeconomic developments in the foreseeable future? Although there is currently nervousness on the stock markets because of the Fed decisions, a look at the past shows that negative effects of such decisions are "forgotten" by the stock market after just 18 days. Other factors are likely to weigh much more heavily. The semiconductor crisis, for example, will keep us busy for a while yet and will provide companies such as Aixtron and Siltronic with solid profits. Most exciting for us is Alerio Gold. Here, risk-averse investors have the opportunity to invest at an early stage and earn disproportionate returns.
Conflict of interest
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