March 29th, 2023 | 08:30 CEST
Copper massively missing - what to do? Nordex, Orestone Mining, JinkoSolar - Greentech shares in the focus of investors
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"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC
Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Nordex - Now the recycling of dilapidated turbines begins
Fossil energy supply is becoming more and more expensive. Therefore, various Greentech solutions for power generation are more in demand than ever. In particular, wind and solar power systems remain the focus of investment in the climate protection sector. The Hamburg-based company Nordex specializes in large wind turbines and energy parks. After three profit warnings in 2022, the share price crashed to below EUR 7 and then simply doubled. After a small consolidation, investors should now be vigilant again.
The wind farmer is dealing pragmatically with the shortage of materials. For recycling reasons, the first of four wind turbines in Jacobsdorf, Brandenburg, was demolished. According to the Company, the demolition became necessary because the concrete towers had defects. New turbines are to be erected in the same place. The advantage: they no longer have to go through the approval loop for 8 years! The dismantling of the turbines is done in single steps to achieve a clean separation of the resources, but due to the heavy damage, the dilapidated tower was blown up. Now it would be interesting only to know whether the turbine was able to earn its historical face value. At the same time, preparations for the new building are already underway.
Nordex had reported a significant loss for 2022. The forecast for 2023 will be presented at the end of this week on March 31. Due to the relatively high price of over EUR 12, the statements of the management should be waited for with confidence because, as the history from 2022 teaches, bad news can sometimes lead to discounts of over 20%.
Orestone Mining - Copper and Gold from British Columbia
There is a significant amount of copper in all green and high-tech products. In North America, the demand trend quickly translated into action, with some 750 new exploration concessions awarded in 2022. Orestone Mining (ORS) operates a 105 sq km copper-gold project called Captain in northern British Columbia. The project is 100% owned and hosts several large porphyry targets that have been explored by geophysical surveys and drilling. The prospective exploration area is located near the already-producing mines of IamGold and Centerra.
Orestone Mining Corp. continues to refine the model for the gold-copper porphyry trend by compiling structural and geological data in combination with an airborne magnetics-based resistivity survey in 2023. Drilling planned for 2023 will target the system's core, with drilling planned to a depth of 1,000 metres. The planned surveys will continue to depth in the event that a gold-copper mineralized altered porphyry is encountered.
The Orestone team has renowned experts with years of experience. In order to get started, a small financing of about CAD 1 million is still needed, which will be done if capital market conditions are good. Currently, the 56.7 million shares outstanding are valued at only CAD 1.7 million. Because of the low valuation, the leverage to rising copper or gold prices in ORS shares is very high.
At this year's PDAC mining conference in Toronto, the International Investment Forum (ii-forum.com) had an exclusive interview with CEO David Hottman:
JinkoSolar - The market does not react to the good figures
Another Greentech stock is solar panel specialist JinkoSolar Holdings Co. Ltd., based in China. The Company is one of Europe's leading suppliers of solar technology and wafers. The manufacturer shipped over 46 gigawatts of modules, cells and wafers in 2022.
Analysts had already anticipated a 105% increase in revenue to USD 12.1 billion, and this increase was primarily attributable to growth in solar modules. Overall, the 130-gigawatt mark in systems shipped was exceeded, but the net profit achieved was less than USD 100 million. Market estimates were much higher, and the stock initially took a dive. It was not the year of the manufacturers because, according to management, they had calculated the sales prices very early but were affected by strong increases in the price of preliminary products towards the end of the year.
Analysts currently do not know how to value the Chinese market leader. This leads to a decent 50% gap between the proclaimed fair value of around USD 68.2 for the JinkoSolar share and the traded price of USD 48.7. The Refinitiv Eikon analysis platform shows a low consensus with a 2023 P/E ratio of around 7.3, so the stock is now cheaply valued again compared to the 2022 highs. Sales should increase by about 25% in 2023, and the margin should now also be more calculable after the experience from 2022.
Greentech cannot do without strategic metals. Copper could become the big sticking point. Orestone Mining has copper and gold in its deposit, JinkoSolar and Nordex would then be potential buyers. All three stocks have their appeal in a risk-adjusted portfolio.
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