March 20th, 2024 | 07:45 CET
Buying opportunity for HelloFresh and Plug Power? When will the dynaCERT share breakthrough happen?
HelloFresh shares have already lost over 50% of their value in 2024. It should be time for a countermovement, but there is currently no sign of it. One analyst believes the share price could rise by almost 100%. However, he is pretty much alone in this prediction. There are also few optimists at Plug Power at the moment. And from tomorrow, the path to profitability will be a little further away for the hydrogen specialist. In contrast, dynaCERT has been showing relative strength for months. The order intake is decent, and an event should trigger the breakthrough for the share.
time to read: 3 minutes
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Author:
Fabian Lorenz
ISIN:
DYNACERT INC. | CA26780A1084 , PLUG POWER INC. DL-_01 | US72919P2020 , HELLOFRESH SE INH O.N. | DE000A161408
Table of contents:
"[...] Why should a modular electrolyzer cost more than a motorcycle? [...]" Sebastian-Justus Schmidt, CEO and Founder, Enapter AG
Author
Fabian Lorenz
For more than twenty years, the Cologne native has been intensively involved with the stock market, both professionally and privately. He is particularly passionate about national and international small and micro caps.
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dynaCERT: When will the breakthrough happen?
While most hydrogen shares have fallen sharply in recent months, the dynaCERT share has shown strength. For over a year, there has been a solid support level at EUR 0.10. While incoming orders have stagnated at Nel & Co. for some time, dynaCERT has been able to report new orders continuously. One reason why the share has not yet been able to take off is likely the negative sentiment in the sector - the newcomer cannot completely detach itself from it. Additionally, investors are awaiting VERRA's certification of dynaCERT's product range. The Company has developed the world's leading quality standard for CO2 certificates. dynaCERT needs VERRA certification to build up a strong new business area with certificate trading.
The Company's core business is HydraGEN™ technology. The patented system can be used to retrofit conventional diesel engines in order to reduce fuel consumption and pollutant emissions. After development was delayed during the COVID-19 pandemic, several hundred orders were placed last year. VERRA certification is expected to give the business another significant boost.
CO2 savings from the use of HydraGEN™ systems could be converted into CO2 certificates, which could then be sold. The revenue from this would be split between dynaCERT and the customers. Tesla is probably the most prominent example of how high the revenue from the sale of certificates can be. After all, this area was the main source of income for Elon Musk's company for several years.
Plug Power: Interest expense increases
Plug Power, among others, has been responsible for the poor sentiment in the hydrogen sector for months. The hydrogen pure play has so far failed to establish a profitable business model, and, most recently, incoming orders have also weakened. The US company's financial problems are huge and will not get any smaller with the latest debt restructuring. This is because the convertible bond with a coupon of 3.75% p.a., which is due to mature in 2025, is to be rescheduled tomorrow. The convertible bond with a volume of around USD 139 million will then be exchanged for a new convertible bond with a coupon of 7% p.a., and the maturity date will be extended by one year to 2026. The bond can then be exchanged for Plug Power shares at a price of USD 4.25. The share is currently trading at USD 3.25.
Plug Power will, therefore, have to pay almost twice as much interest for the time being, making it even more challenging to reach profitability. However, break-even is not expected before 2026 anyway.
HelloFresh: Share continues to decline
At the beginning of March, HelloFresh shocked its shareholders with its quarterly figures. In response, the share price plummeted from just under EUR 12 to below EUR 7. The DAX-listed company has not recovered from this downturn yet. There has been no countermovement, and analysts are generally cautious. Until yesterday, Barclays was still in the bull camp. But then the "Overweight" was changed to "Equalweight" and the price target was reduced from EUR 12 to EUR 7.60. Analysts had already shaved the price target from EUR 28 to EUR 12 directly after the quarterly figures. They are concerned about HelloFresh's business development in the US. As a result, only JP Morgan and Berenberg now recommend buying HelloFresh shares. However, the price targets have also been significantly reduced here, from EUR 18 to EUR 9 by JP Morgan and from EUR 31 to EUR 9.50 by Berenberg.
The HelloFresh bears include Bernstein Research, UBS and DZ Bank. Bernstein has the lowest price target at EUR 5.30. The analysts consider the average profit expectations for the current year to be too high.
Hydrogen is a technology with a future. However, when selecting shares from this sector, investors must look closely. Plug Power is one of the market leaders, but investors have been waiting many years for a profitable business model. dynaCERT is still in its infancy, and not everything has gone smoothly for the Canadians in the past, but significant progress has been made in 2023. With VERRA certification, the breakthrough for the share could finally happen. A lot of trust has been lost at HelloFresh with the latest figures. It is noteworthy that there has been no countermovement in the share price so far.
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.
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