Ballard Power, Exasol, Xiaomi - Shares on the rise

Xiaomi's Premiere

The general conditions for electromobility have been more favorable in the past. However, the growth curve has flattened in recent months, and the protagonists are fighting to gain further market share by cutting prices. This is putting pressure on the margins of electric vehicle manufacturers, and the market leader, BYD, has clearly felt this in its sales figures for the first quarter.

According to a stock exchange release published by the Shenzhen-based company, 300,114 electric vehicles were sold in the first three months of this year. That represents a decrease of 43% compared to the fourth quarter of 2023, in which the Company set a record with 526,409 units sold. Despite this, BYD recorded a 13.4% increase in sales figures in the first quarter of 2024 compared to the same period of the previous year.

All the more remarkable is the fact that the technology group Xiaomi, originally known as a smartphone manufacturer, has ventured into the EV business. As announced by co-founder Lei Jun, Xiaomi will start deliveries in 28 cities from the middle of this week. Orders for the SU7, short for Speed Ultra 7, which is offered at a price of less than USD 30,000, exceeded forecasts. Almost 90,000 orders were received within the first 24 hours of the sales launch.

The Xiaomi share price rose by around 18% at its peak, marking a new two-year high of USD 2.35 after a sideways movement that had lasted for around a year. The market capitalization rose to USD 53.70 billion, surpassing the valuations of the traditional car manufacturers General Motors and Ford.

Exasol - Turnaround story with potential

Since the end of 2022, artificial intelligence has finally reached the mainstream with the introduction of ChatGPT. Since then, a new star has been born on the stock markets, and AI-related companies have multiplied in value over the past 16 months, reaching valuations in the billions.

Nevertheless, despite the hype, undiscovered companies in this sector still have moderate valuations and could become the new stock market stars in the next upward movement.

Exasol, based in Nuremberg, is currently capitalized at just EUR 72.05 million. With 20 years of experience, the Company offers disruptive software for data analysis based on artificial intelligence, which can be used to significantly accelerate otherwise very complex processes. It has over 200 customers, including global brands such as Adidas, T-Mobile, and Revolut, in over 30 countries worldwide.

Exasol reported recurring revenue of over EUR 41 million for 2023. EBITDA, which was still clearly negative at EUR 5.45 million last year, is expected to reach the break-even point at the EBITDA level by the second quarter of 2024 at the latest**, according to CEO Jan-Dirk Henrich. The analyst firm M.M Warburg & Co. continues to believe in the Exasol story and issued a "Buy" recommendation with a price target of EUR 6.30 in its latest study, an upside of over 130% on the current share price.

Ballard Power - Momentum from major order

While the major indices are jumping from one high to the next, shares in the renewable energy sector are still in correction mode. For example, fuel cell pioneer Ballard Power has lost over 92% of its market value since its peak at the beginning of February 2021. Last week, the Canadian company hit another annual low of USD 2.70. However, with the announcement published on Easter Monday and a jump in the share price of almost 18%, a countermovement could start here, at least briefly. On the positive side, the MACD trend indicator has already shown positive divergences on several occasions, which could indicate a sustained rebound.

The reason for the jubilation was the announcement of a significant order for the delivery of at least 1,000 fuel cells by 2027 to Solaris Bus & Coach, a leading Polish manufacturer of buses and commercial vehicles. Solaris has already purchased fuel cells from the Canadian company in the past.

Compared to previous contracts, which provided for a delivery of 300 agreed fuel cells, an additional 700 units are now planned. Ballard Power will also provide warranty and maintenance services similar to those offered in the aircraft and major appliance industries. The fuel cells are intended for use in buses that will serve up to 22 European mass transit operators.

The stock market celebrates the start of deliveries of Xiaomi's electric vehicles. Following the announcement of a major order, Ballard Power could have reached at least a cyclical low. Analysts see the AI company Exasol as a clear Buy candidate with the opportunity to multiply.