February 3rd, 2023 | 12:54 CET
BYD, Power Nickel and Infineon - News drives share prices
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"[...] Nickel, therefore, benefits twice: firstly from its growing importance within batteries and secondly from the generally growing demand for such storage. [...]" Terry Lynch, CEO, Power Nickel
The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
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Infineon - Rosy prospects
After a somewhat disappointing 2022, shares from the semiconductor sector are performing again and were among the outperformers in the first four weeks of the new stock market year. The German flagship company, based in Neubiberg, gained almost 30%. The share price rally was fueled by a thoroughly surprisingly positive outlook. For fiscal 2022/2023, the DAX-listed group expects sales of EUR 15.5 billion and a segment profit margin of 25%. Previously, the target was only 24%.
Infineon became more optimistic due to the positive results of its first fiscal quarter, with a margin of 28%. Although sales fell by 5% to EUR 3.95 billion compared to the previous quarter, segment profit increased by 5% to EUR 1.11 billion. Before non-recurring items, gross profit net of cost of sales was 49.2% higher compared to the fourth quarter of fiscal 2021/2022.
Following the announcement, Infineon shares gained more than 7% to EUR 35.90. Analysts at US investment bank Goldman Sachs reiterated their "buy" rating with a price target of EUR 42.50.
Power Nickel - Bottom formation about to be completed
After a disappointing 2022 stock market year, the signs also continue to point to recovery for the exploration company Power Nickel. After successfully testing the lows of CAD 0.09 several times, the mining company is now trading at CAD 0.28, only marginally below the high from 2022 at CAD 0.30. A sustainable overcoming of the resistance would pave the way to the annual high of 2021 at CAD 0.55.
Fundamentally, Power Nickel is in the right place at the right time because the demand for battery metals is increasing enormously due to the electrification of transport. With the NISK project, the Canadians aim to create one of the most sustainable sources of metals in the Western world. NISK comprises a large land position with 20km of strike length and is located near James Bay in Quebec. To date, high-grade mineralization of nickel has been proven, as well as the mineralization of copper, cobalt, palladium and platinum.
In addition, the Company has considerable spin-off imagination. For example, management intends to push for the spin-off of non-core assets into a separate company, which would then be listed on the stock exchange.
Strategically important is the announcement of a partnership with Fleet Space Technologies. The Company from Down Under develops and operates microsatellites that provide universal connectivity in all parts of the world, including exploration of nickel ore deposits on NISK. Power Nickel plans to use sonic mapping technology to locate more high-grade nickel sulfide deposits with greater accuracy. The two advantages of this technology are that the land package can now be explored in a fraction of the time. In addition, drilling can be much more efficient with this data.
BYD - Market leadership expanded
The positive news surrounding the annual figures of the Chinese market leader was used by Berkshire Hathaway, the investment company headed by Warren Buffett, to sell off further BYD shares. Thus, the investment legend sold another 1.55 million H-shares with an equivalent value of USD 44.85 million. The sale reduced Berkshire's stake in the Chinese electric vehicle maker's issued H-shares to 12.9% as of January 27.
The "Build Your Dream" company shone again in its recently released preliminary full-year 2022 numbers, topping analyst expectations by a wide margin. As the Shenzhen-based company announced, revenue in the fourth quarter was CNY 145 billion or around EUR 20 billion. For the full year, this means revenues of CNY 420 billion or EUR 57 billion. Analysts had expected only CNY 400 billion. Compared with the previous year, this represents an increase of 90%. Net income increased fivefold to CNY 17 billion compared with around CNY 2.3 billion. Here, too, BYD was well above analyst estimates. The analysts of the Swiss major bank Credit Suisse left the rating "outperform" and increased the price target from HKD 410 to HKD 420, equivalent to EUR 48.69. At the current price level, this means a potential of around 45%.
News influences share prices. BYD was able to surprise analysts with strong annual figures, and the outlook of semiconductor producer Infineon was also convincing. Power Nickel is making much faster progress in its drilling programs due to the newly concluded partnership.
Conflict of interest
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