January 28th, 2022 | 12:07 CET
Daimler, Altech Advanced Materials, Nel ASA, Varta - Battery bull market even without Tesla!
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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.
Daimler - Mercedes invests in a new solid-state battery
The automotive arm of the former Daimler Group will operate under the well-known brand name Mercedes-Benz AG in the near future. It remains important to set the course for the transformation to e-mobility. To this end, the Stuttgart-based technology group recently acquired a stake in the Taiwanese solid-state battery cell manufacturer ProLogium in the high double-digit million euro range to drive forward the development of next-generation battery cells.
The first jointly built prototypes could be used in Mercedes-Benz test vehicles as early as the next few years. It is not yet known which model series are involved. However, Daimler Board of Management member Markus Schäfer has identified the two levers of electromobility: Efficiency and range. The latest generation of solid-state technologies has the potential to significantly reduce the size and weight of batteries for electric vehicles. At the same time, the use of innovative materials and a new production design enables the range of conventional Li-ion battery cells to be almost doubled. A good approach, in our opinion!
The cooperation partner ProLogium Technology has been working with Mercedes-Benz on testing new types of battery cells since 2016, and this partnership is now being deepened through an equity investment. As part of the development partnership, Mercedes-Benz will take a seat on the ProLogium Board of Directors. According to Mercedes-Benz, the partnership will strengthen the further development of battery technology and the partner's planned expansion of production capacities in Europe. Mercedes-Benz is thus coming closer to its goal of launching eight gigafactories for cell production together with partners.
The Daimler share benefits from the news and can jump back above the EUR 70 mark. The long-term picture of the Stuttgart-based Company looks very well-rounded, and there is also a dividend of over 4%. Collect!
Altech Advanced Materials - On the trail of the mega-battery
When it comes to batteries, the German Company Altech Advanced Materials AG (AAM for short) is also on the move. The management of AAM assumes that e-vehicles will soon be cheaper than conventional combustion engines due to technological progress. The Company does not yet see a price war in battery technology but rather the potential to significantly increase performance in the next few years. The key factors for the success of electric cars will be charging time, range and the available infrastructure.
The Heidelberg-based Company is a Frankfurt-listed investment company in the field of technological solutions for electricity storage, especially in the area of e-mobility. Its own research efforts aim to improve cathode properties with the desired increase in power density, operational reliability, and an extension of service life.
AAM sees the production of relevant ceramic base materials used in the lithium-ion battery, both in the cathode, separator and anode, as a starting point for its research. The use of aluminum oxide for coating anode material in lithium-ion batteries is an essential step in the expected increase in performance. Another clear goal is to reduce the cost per kWh output to below USD 100, the benchmark that all market participants are currently researching. Security of supply is currently far from assured for the expected demand of the European automotive industry due to strained supply chains. Contrary to globalization, local availability would significantly reduce the current complexity. A desirable goal of AAM is to solve these deficits.
The AAM share is currently attracting more and more turnover, with the most active trading venue being Frankfurt. A feasibility study has been announced for the first quarter of 2022. With these findings, the share price will become really exciting. Of course, positioning is still speculative at the moment.
Nel ASA and Varta - Still quite a bit of hope priced in
Recently, we had a close eye on the two technology stocks, Nel ASA and Varta. The correction since the beginning of the year has hit both values significantly. Nel ASA lost 32%, and Varta did not fare much better with a loss of 25%. So how do things stand with the former darlings of the new generation of stock market investors?
Even today, Nel ASA, with a valuation of just under EUR 1.6 billion, is still a long way from its sales base at an estimated EUR 120 million. After all, the price-to-sales ratio has already fallen by a full 20 points to 13 due to the recent correction. The situation had looked quite different at last year's highs. Of the 24 analyst firms surveyed, the consensus is already positive on earnings estimates for 2025. Some will say that this is still 3 years away, while the hydrogen bulls may already find this promising. As always, the glass is either half empty or half full. Technically, the only support left in the current downward trend is around EUR 1 or the equivalent of NOK 10.05.
Concerning Varta, investors are waiting for an interim report on the 2021 financial year. The full report will not be announced until March 30, 2022. At the current pace of the share price decline, Varta would be advised to publish a preliminary announcement as soon as possible, provided that it naturally holds positive surprises.
We are keeping both stocks on the short watch list. A quick 10-20% recovery is technically possible if the NASDAQ turns back into an uptrend. The current overvaluation of the stocks remains with the known numbers.
The NASDAQ is trending down, affecting top European growth stocks. The drumming on Nel ASA and Varta will likely only stop with a US turn. Also, Daimler will not fly in this environment. There is a lot of fantasy for the still small Altech share because something huge could emerge here in the next few years.
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