September 23rd, 2022 | 10:10 CEST
BYD, Kleos Space, Palantir - Market leaders in the clearance sale
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"[...] We know exactly what we are doing and are implementing what we consider to be a proven technology in an industrially applicable and scalable way. [...]" Uwe Ahrens, Director, Altech Advanced Materials AG
Palantir - The number 1 AI software platform
According to the market research institute IDC, the data analysis company from Denver, Colorado, has captured the place in the sun for sales of artificial intelligence software, leaving big players such as Microsoft, IBM, AWS and Google far behind. However, for Palantir CEO Alex Karp, who is both driven and controversial, the end of growth is far from here. In an interim report on the Company's development, the Company leader commented that the strength of the US business, in particular, is considerable and is gaining more and more momentum.
Karp is more than optimistic about the future: "While most companies are content to address the idiosyncratic needs and inefficiencies of select customers in a subset of industries, the market we want to address, especially among the world's commercial enterprises, is basically unlimited. The most important institutions in our world, commercial and military, will not survive without the right software. And we are in the process of developing it."
Despite a mighty growth rate of about 67% annually since 2019, both analysts and investors do not yet fully believe it will continue to evolve. Especially in terms of profitability, Palantir has regularly disappointed in recent quarterly results. The share has lost around 60% of its value in the current year, 2022 alone. It is now trading just close to the USD 8.00 mark. Currently, the share price is working on a bottoming out. If the USD 8.43 mark is exceeded, the way towards the next resistance at USD 11.45 would be clear, at least in the short term. The market capitalization is currently USD 15.87 billion.
Kleos Space - Significantly better data
Valued much more favorably, at around EUR 35.57 million is the global market leader in high-frequency reconnaissance, with subsidiaries in Luxembourg, the US and the UK. The space-based earth observation company uses space technology to locate radio transmissions around the globe, enabling it to efficiently analyze and detect illegal activities on land and at sea. This involves using satellite clusters to collect radio frequency data, transmitting it to the ground, analyzing it with AI-powered technology, and delivering it to the relevant clientele.
The clients, including analytics and intelligence services, are licensing data on a subscription basis (Data-as-a-Service) or by purchasing dedicated satellite capacity (Mission-as-a-Service, MaaS). The data provided is for government and commercial use cases to make better and faster decisions.
At the moment, three clusters of four satellites each are in orbit. In October this year, a fourth cluster will be added with the Observer Mission (KSF3) satellites, further improving data quality. Equipped with AIS, VHF and X-band payloads, the four satellites will increase Kleos Space's data collection capacity by up to 119 million sq km per day. They will also allow the average daily overflight rate over the 15-degree latitude area to increase to about five times per day.
In the medium term, management plans to deploy 20 clusters. In order to fund the growth, PURE Asset Management has accepted a four-year, USD 10 million secured loan. The fact that "surveillance from space" is becoming more mainstream due to growing geopolitical tensions is shown by the fact that orders in May and June amounted to more than EUR 1 million. The Kleos Space share was unable to escape the general market correction. The stock has lost around 50% since the beginning of the year. That offers a long-term opportunity to participate in the safety trend at the current level.
BYD - Buffett shock not yet digested
Even the Chinese market leader in electric mobility could not defy the market correction in the end. It looked for a long time as if the Shenzhen-based company would continue to rush from high to high, but the shock news came from the shareholder circle. None other than investor legend Warren Buffett stated that he wanted to sell pieces of the "Build Your Dream" company.
The consequence was a crash of the share price from about USD 35.00 to currently USD 27.06, a drop of about 23% within days. The possibility of a further slide in the share price is given. If the striking support at USD 26.35 does not hold, the next price target should be the upward trend formed since May 2021 at USD 23.82.
The FED is driving the markets back and forth. A further interest rate hike and calls for more to follow this year put renewed pressure on the markets. Global industry leaders, which are currently at attractive long-term levels, were also hit. Palantir is currently working on its bottoming out, and the launch of the fourth cluster at Kleos Space should provide a boost. BYD, on the other hand, could see the correction go one floor lower.
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