May 3rd, 2022 | 13:01 CEST
BASF, Meta Materials, NIO - New opportunities through the correction
Table of contents:
Meta Materials - Breakthrough technology
Companies with new, innovative technologies are subject to high volatility at the beginning of their trend. Similar to Yahoo and Amazon at the end of the last millennium or Google, the share price of Meta Materials is also being shaken back and forth vigorously. While the "Lux Research Innovator of the Year 2021" share was still at USD 2.17 at the beginning of March, four weeks later, it is almost 50% lower at USD 1.21. From an operational point of view, everything is still going according to plan. Meta Materials' products can be divided into three areas: holography, lithography and wireless sensor technology with strong IT networking and artificial intelligence embedding. The developer of high-performance functional materials and nanocomposites produces specialized coatings capable of redirecting light, sound, heat or radio waves using specialized nanotechnology. It enables leading global brands to deliver consumer electronics, 5G communications, health and wellness, aerospace, automotive and clean energy products to their customers.
Nanotech Security, acquired in 2021, provides Meta Materials with a nano-optical technology that has security features to protect against counterfeiting of government documents and currency and authenticate brands. As a result, USD 2.2 million in acquisitions could be made from an undisclosed central bank. According to the framework agreement, the volume could increase to a total of USD 41.5 million over the next 5 years.
The acquisition of Plasma App in a USD 20 million stock transaction puts Meta Materials in an even better position strategically. "This is a strategic acquisition for META that combines the best nanostructuring technologies with the best coating technology. PLASMAfusion is a versatile coating platform technology that we believe will enhance our existing manufacturing processes, expand our IP portfolio, and open new markets," said George Palikaras, President and CEO of META, who will also appear at the IIF on May 19.
The market for metamaterials is growing rapidly. Meta Materials is perfectly positioned due to its extensive portfolio of 247 patents in 65 patent families. Its market capitalization has melted down to EUR 335.25 million. In the long term, a sustainable bottom could form at current levels.
BASF - New low for the year
With a decline of 6% and the opening of a large price gap to EUR 47.12, the chemicals group from Ludwigshafen danced into May, and at the same time, to a new low for the year. However, the low of March 7 was successfully recovered so that a double bottom would be in place from a chart-technical point of view.
Moreover, the sell-off is not due to negative news but the dividend discount of EUR 3.40. Last week, BASF reported its final figures for the first quarter of the current fiscal year 2022 and exceeded most analysts' estimates. Compared to the first quarter of 2021, sales rose by EUR 3.7 billion to EUR 23.1 billion. The main reason for the sales growth was higher prices, especially in the Chemicals and Materials segments.
Major Swiss bank UBS lowered its price target for BASF from EUR 58 to EUR 52 but kept its rating at "neutral." Likewise, analyst firm Jefferies sees less potential for BASF shares. After the full quarterly figures, the target was lowered from EUR 74 to EUR 64, but the analysts maintained their "buy" rating.
NIO - Hard impact
The Chinese electric car company NIO suffered a sharp decline in its delivery figures for the month of April. The Company managed to deliver 5,074 vehicles, 29% less than a year ago and one of the lowest results in recent months. Compared to the month of March, deliveries crashed by 49%. The reasons were supply chain volatilities and other constraints caused by a new wave of COVID-19 outbreaks in certain regions of China.
According to the website cnevpost.com, NIO is also rumored to be planning several new models, including one codenamed Aries. The Aries could be an ES8 model based on NIO's NT 2.0 platform. According to one auto blogger, NIO is also planning several other models, including the EC7 and a hatchback version of the ET5. No new model was launched last year. Chart-wise, no investment in NIO is pressing at the moment. There is still a gap to close at USD 15.80. A break below USD 16 also threatens a test of the low for the year at USD 13.01.
The stock market is showing a weak performance in the current year due to geopolitical and monetary uncertainties. As a result, some shares are already at an attractive level in the long term. BASF's price targets were cut by analysts, while NIO's sales figures fell drastically. After a sharp drop in the share price, Meta Materials, on the other hand, is tempting investors to make a speculative purchase.
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