17. June 2021 | 13:52 CET
Daimler, Mineworx Technologies, BASF: Investing in the mobility revolution
The world keeps spinning - faster and faster, it feels. New technology is causing certain industries to rethink. Electromobility is one such catalyst: mining companies and companies from the chemical industry and other suppliers must prepare themselves because soon, most cars will run on batteries. There are great opportunities here - for carmakers who are on their toes and for resourceful experts in the field of recycling.
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ISIN: DE0007100000 , CA6034652041 , DE000BASF111
Daimler: What is next?
One German Company that is also being traded with advance praise on the stock market is Daimler. The automaker is making great strides in electrifying its fleet. As early as 2022, every car is to be available as an electric version. Daimler is also planning to spin off its commercial vehicle division and float it separately on the stock market. As a result, this could bring fresh capital into the Company's coffers without relinquishing too much influence in commercial vehicles. In the first quarter, Daimler already showed that the Company has come out of the crisis well, significantly increasing its revenue, operating profit and unit sales. Above all, the cost reductions were well received by the stock market.
In the last three months, the share price has risen by 13%. While that is not a great deal, Daimler has still gained 122% over the past 12 months. The slowdown in the share price increase suggests that the e-car fantasy surrounding Daimler is now priced in. The Company is nevertheless well positioned to continue growing in line with the market in the coming months and years. The dark days for carmakers are over, Daimler has arrived in the future.
Mineworx Technologies: Precious metals from catalytic converters
One company that has turned the mobility revolution into a business model is Mineworx Technologies. The Company has set out to extract the precious metals platinum and palladium from car catalytic converters and then return them to the cycle. As precious metals have risen steadily in price in recent months and years, and cars with internal combustion engines are slowly but surely being sidelined, Mineworx's business model appears attractive.
The Company plans to start its pilot plant in July and generate initial revenues by the end of the year. Unlike conventional processes, Mineworx's process does not melt down catalysts but instead grinds relevant parts and processes them further using chemical methods. This is how platinum and palladium are to be extracted. Mineworx Technologies expects sales of USD 100 million with a gross margin of 20%. The partner is Davis Recycling, a well-known company in the USA. If everything goes smoothly with the pilot production, further production facilities are to be built. Currently, Mineworx Technologies is valued at only about USD 25 million. Since the Company itself has USD 100 million sales and a gross profit of about USD 20 million, the P/E ratio would be only slightly above 1.
While Mineworx is still guilty of proving that its approach works, the Company has already won over a recycling company in Davis Recycling. Also, the pilot plant is already funded. Mineworx Technologies is a highly speculative investment. Unlike other hyped sectors, however, the valuation is still very low. Anyone who can allocate such stocks sensibly in their portfolio should take a closer look at the value. With its recycling concept, Mineworx certainly meets the spirit of the times.
BASF: A solid stock for investors with patience
Even though the Ludwigshafen-based Company BASF is also involved in recycling and other processes, it is anything but a trendsetter. BASF has more than six sectors, including basic chemicals, industrials, agricultural chemicals, nutrition and care, surfaces, and other chemical materials.
At the beginning of the year, BASF slightly disappointed the market with weak figures. But market participants quickly focused on the good: BASF shines with a high dividend and is very broadly positioned in all aspects of chemicals. In addition, the Rhineland-Palatinate Company has invested in the Corona Crisis and streamlined its processes. This has led the market to take a more positive view of the share again. Over one year, the share has returned 31.4%. Although things did not go so well on the stock market in the short term, the share is also facing several resistances. If it manages to break through the EUR 75 mark, BASF should continue to rise. However, the stock will not be a high-flyer any time soon.