06. January 2021 | 07:57 CET
Amazon, dynaCERT, Pfizer: Innovation thanks to proven ideas
Individual stocks in the stock market are valued based on future earnings potential, which results in high demand for companies poised for growth. The most recent examples are hydrogen stocks, such as NEL and Plug Power. Gold has also been experiencing a renaissance since the pandemic's outbreak and is poised to climb to new heights in the first trading days of 2021. However, good returns can also be achieved with supposedly established stocks. Although ordering from Amazon is as obvious to many of us as going to the nearest supermarket, the Company still has excellent growth potential.
time to read: 3 minutes by Nico Popp
Amazon: Growth at a high level
Amazon has long been more than just a retailer on the web. In addition to ordering almost any product via the platform, Amazon also offers services and is a media company. With inexpensive tablets and the streaming offer Prime Video, the former bookseller has made it into many living rooms. In the meantime, even the Bundesliga soccer league is flickering across the in-house streaming platform. Traditional online retailing has become even more popular as a result of the pandemic. Many older people ventured online for the first time in March 2020, placed orders and had good experiences. Amazon, in particular, as the top dog with accommodating warranty processing, is likely to benefit from the growing popularity of older generations.
While traditional retailers had to lay off staff and suffered from the pandemic restrictions, Amazon hired a whole 400,000 new people last year. This contrast emphasizes how well-positioned Amazon is. The numbers are right, too. In the third quarter of 2020 alone, Amazon made a profit of USD 6.3 billion. That's already the next record after the quarter before. The stock has gained more than 50% on a one-year horizon and is also already ambitiously valued. Amazon remains a stable value. Ten years from now, Amazon will still be making healthy sales - and it remains to be seen how many traditional retailers will fare by then.
dynaCERT: Hydrogen Catalysts and Software for the Traffic Turnaround
The Canadian Company dynaCERT is also reaching for the stars. Its goal is to make existing vehicle fleets more sustainable. To this end, dynaCERT has developed an electrolysis unit with hydrogen technology that can be used primarily in large diesel engines and is said to optimize combustion by up to 19%. In recent months, some US municipalities have stepped in and converted their public transport systems. Public authorities, in particular, are under pressure to pursue sustainable solutions while keeping costs down. Compared to buses with electric motors, the purchase of a HydraGEN retrofit unit can pay for itself within 12 months, according to the manufacturer.
In addition to its catalysts, dynaCERT is also active in the field of telematics software. The aim is to measure savings and use the wealth of data to improve the environmental balance sheet further. Thanks to the savings documentation, fleet operators can receive credits in the form of CO2 certificates that are publicly traded. These CO2 certificates create a further incentive to use dynaCERT's solutions. In German trading, the share was able to stabilize just below EUR 0.40 and recently indicated breakouts several times. Speculative investors can add the stock to their watchlist.
Pfizer: Blockbusters secure the dividend
The Pfizer share also shows that share price gains and innovations do not necessarily have to come from startups with revolutionary technology. Although the pharmaceutical giant is cooperating with the Mainz-based Company BioNTech in producing the Covid-19 vaccine and is relying on the new mRNA technology, Pfizer also offers a lot of classic "bread-and-butter" business. In total, Pfizer has ten blockbuster drugs on offer, each of which generates more than USD 1 billion in sales. Pfizer has spun off its generics and consumer products business into a joint venture with GlaxoSmithKline and focuses only on high-margin drugs. In this way, Pfizer hopes to build on Viagra, Lipitor, and other former blockbusters' successes.
This change in strategy has not yet gone down well on the stock market: Over a one-year period, the share price fell by 13.8% despite the vaccine hype. The value also shows a slight downward trend over a three-year period. However, Pfizer's dividend is the primary driver of returns: The Company recently announced its 328th consecutive quarterly dividend. The dividend yield is thus stable at over 4%. That is probably another reason why investor legend Warren Buffett has recently invested heavily in pharmaceutical stocks and has also bought Pfizer. Those who are not too bored by the leisurely share price development will find Pfizer a stable long-term pillar for their portfolio.