Close menu

May 23rd, 2022 | 12:49 CEST

BASF, MAS Gold, Plug Power - Shares with great turnaround potential

  • Gold
  • Hydrogen
  • Investments
Photo credits:

The Fear & Greed Index is down to 11, which means nothing other than extreme fear. And there are many areas causing headaches for investors. There is the Ukraine crisis, inflation, rising interest rates in the US, supply chain problems due to zero-COVID policies in China, and fear of recession. However, the S&P has formed a double bottom last week, which raises hope for a turnaround in the markets. Due to the crises, there are currently also opportunities again. We take a look at three potential turnaround candidates.

time to read: 5 minutes | Author: Armin Schulz
ISIN: BASF SE NA O.N. | DE000BASF111 , MAS Gold Corp. | CA57457A1057 , PLUG POWER INC. DL-_01 | US72919P2020

Table of contents:

    Bill Guy, Chairman, Theta Gold Mines Limited
    "[...] 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

    Full interview


    BASF - Heavily sold off

    The Ukraine crisis is costing BASF dearly. The Company has many business ties with Russia. First and foremost, there is the Wintershall Dea stake, in which the Ludwigshafen-based company owns around 73% of the shares, with the remainder held by a Russian oligarch via Letter One. Before the war broke out, the plan was to take Wintershall Dea public. In its current form, this is no longer possible, so attempts are being made to sell the Russian business of the holding. The joint venture partner Letter One is a potential buyer. If the spin-off succeeds, an IPO would again be conceivable.

    Apart from that, support with technology related to the production of Russian gas is no longer possible. Cheap energy is therefore no longer available in return. The Group fears a supply stop of Russian energy, as the Company is very energy-hungry overall. A foretaste was provided by the first-quarter figures, where adjusted profit rose about 20% YOY, but write-downs of around EUR 1.7bn on Wintershall Dea dented the good result. For 2022, management expects a decline in sales and earnings. Nevertheless, earnings are expected to be between EUR 6.6 billion and EUR 7.2 billion.

    That represents a decline of about 15% compared to 2021, but the stock plunged by more than 48% at its peak. From EUR 69.15, it went down to EUR 46.465. The share is currently trading at EUR 48.85. If the Group keeps the dividend stable, the current dividend yield amounts to 6.9%. On a positive note, Goldman Sachs has increased its stake in the Company and now holds 5.32% of the shares. Among analysts, there is a mixed picture between buy and hold. The price targets are between EUR 50 and EUR 74. If the Ukraine conflict is resolved, the share should pick up quickly.

    MAS Gold - Results from the winter drilling program

    The framework conditions for gold are generally good. High inflation is driving investors into gold as a safe haven, and in 2021 demand for physical gold reached an 8-year high. On average, experts see the estimated 3-year gold price at USD 2,225. With the start of the Ukraine crisis, the price of gold rose sharply but then consolidated again to around USD 1,800. The price bounced off there and is currently quoted at USD 1,842.10. A high gold price helps gold explorers such as the Canadian MAS Gold advance their explorations. The Company reports more than 1 million ounces of gold at its projects in the La Ronge Gold Belt in Saskatchewan. The 2022 target is to increase mineral resources to 1.5 million ounces.

    The target is to be achieved through acquisition and drilling. At the end of March, the final acquisition of the Preview SW project was finalized. The first results from the drilling program were then released on April 26. Gold occurrences with a grade of up to 2.81 g/t gold were detected in all 5 drill holes. On May 16, results from 7 additional drill holes followed, all of which were also successful in detecting gold. At the peak, up to 3.06 g/t gold was found. CEO Jim Engdahl expressed his satisfaction, "These results show that mineralization occurs near-surface in previously untested locations and that the North Lake deposit continues to expand along strike." Results from 22 additional drill holes are pending.

    Once the results are available, a new drilling program will be planned based on the data. The funds needed for this are expected to come from a private placement. On May 5, the Company announced that a private placement would be made. Eleven days later, it was announced that shares would be issued at 0.08 Canadian dollars (CAD) each. It is expected to raise between CAD 1.5 and 3 million. For this purpose, each investor will receive a warrant that can be exercised at CAD 0.20. Since the announcement of the private placement, the share has been under pressure and is quoted at CAD 0.08. The market capitalization is thus only CAD 14 million. Favorable for the existing gold deposits in one of the best mining regions in the world.

    Plug Power - Big orders

    The Ukraine crisis has shown Europe again how important it is to look for alternative energies. As recently as mid-May, the German government decided to fund hydrogen research with a further EUR 2 billion. Hydrogen is intended to replace fossil fuels in the long term. In particular, the chemical and steel industries, which require a lot of energy, need an alternative to the status quo. The technology could also become important for transportation. One might think that these are ideal conditions for one of the biggest hydrogen players, Plug Power. But if you look at the share price, the world looks different.

    The reason for this is the latest quarterly figures. Analysts, on average, expected a minus of a good USD 0.15 per share and an increase in sales of about 101%. Both expectations were missed, and the loss of USD 0.27 per share was significantly higher than anticipated. Compared to the previous year, the loss was even more than doubled. But there was also good news, as a deal with Walmart was announced on April 19. Plug Power is to supply 20t of green hydrogen for up to 9,500 forklifts. On May 17, H2 Energy Europe awarded the Company a contract to supply the world's largest electrolyzer plant with one gigawatt.

    Following the quarterly report, the share price took a dive and reached a new multi-year low of USD 12.70. From there, it went up again to currently USD 16.45. Hydrogen is set to become a future market, and losses are being accepted for growth. But in the current market environment, weak figures are severely punished. There is great interest in helping hydrogen to achieve a breakthrough. As soon as the price of hydrogen drops noticeably, the switch will become more and more interesting for companies. Walmart is just one of the big players that want to become climate-neutral.

    There are turnaround candidates in a wide variety of industries. Each has different conditions and problems. BASF is suffering from the Ukraine situation and has already lost almost 50% of its value. MAS Gold is expanding its mineral resources and needs fresh capital to do so, which is weighing on the stock, at least in the short term. In the long term, however, successful drilling will bring an increase in proven resources. Plug Power benefits from the Ukraine crisis, as hydrogen is again coming into focus. Losses are part and parcel of a future technology.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.

    The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.

    Der Autor

    Armin Schulz

    Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

    About the author

    Related comments:

    Commented by Armin Schulz on May 21st, 2024 | 07:15 CEST

    K+S, Globex Mining, Barrick Gold - Commodity stocks: Make money now

    • Mining
    • Gold
    • Commodities
    • fertilizer

    The commodities market in 2024 is characterized by high volatility, driven by strong demand, supply bottlenecks, and technological shifts to renewable energy, which make lithium and copper, for example, more expensive. In addition, inflation concerns make precious metals attractive as a hedge against inflation, while the central banks' interest rate policy is also a factor. Geopolitical tensions further disrupt supply chains and drive up prices. In this context, investments in commodity shares are becoming increasingly important. This form of investment allows investors to benefit indirectly from price fluctuations and the increase in the value of commodities without having to physically invest in the commodities themselves. We are, therefore, looking at three commodity companies today and analyzing their potential.


    Commented by André Will-Laudien on May 16th, 2024 | 07:00 CEST

    Attention: Here we go! Hydrogen and uranium on the rise: Plug Power, Nel ASA, Kraken Energy and Siemens Energy in focus

    • Mining
    • Uranium
    • Hydrogen
    • renewableenergies
    • Energy

    It has finally happened! After months of sell-offs in hydrogen shares, there was a sigh of relief across the sector the day before yesterday. The reason: industry leader Plug Power received a government guarantee of USD 1.66 billion as backing for the construction of six-megawatt sites nationwide to create an initial hydrogen infrastructure. The Department of Energy (DOE) is thus demonstrating that the US is serious about investing in alternative energies. The decision boosted the entire energy sector, with uranium also continuing its recent upward trend. Where do the opportunities lie for investors?


    Commented by Fabian Lorenz on May 15th, 2024 | 07:00 CEST

    Horror at Plug Power! The cash registers are ringing at TUI and Carbon Done Right Developments!

    • Sustainability
    • Hydrogen
    • fuelcell
    • Travel

    The stock market is sometimes crazy. Plug Power reported a slump in sales and further increasing losses, yet the share price can rise significantly. Is this the turnaround for the hydrogen share? What caused the share price to rise? In contrast, the cash registers are ringing at TUI and Carbon Done Right Developments. The latter is benefiting from milestone payments from oil giant BP for a reforestation project to improve its environmental footprint. And business is also booming at TUI. The tourism group will present its financial results today, and the outlook for the summer season should be positive. Analysts see 50% upside potential.