November 24th, 2022 | 13:01 CET
dynaCERT, Pathfinder Ventures, SFC Energy - Small caps on the upswing
After the sharp corrections of the last months, the time of suffering of many shareholders of growth companies seems to be over. The companies, which have been badly affected by the stricter monetary policy, are sending clear signs of life, both in terms of charts and fundamentals. Volatility is likely to remain in the coming months. From a long-term perspective, however, there are attractive entry levels at a significantly cheaper level with opportunities for a strong rebound.
time to read: 4 minutes
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Author:
Stefan Feulner
ISIN:
DYNACERT INC. | CA26780A1084 , PATHFINDER VENTURES INC | CA70323P1071 , SFC ENERGY AG | DE0007568578
Table of contents:
Author
Stefan Feulner
The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
He is passionate about analyzing a wide variety of business models and investigating new trends.
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dynaCERT - Widening of the scope
After corona-related delays and a share crash of around 80%, news flow has picked up noticeably in recent weeks. Thereby dynaCERT announced several strategically important orders, but the large orders with significantly higher quantities are still missing. According to CEO Jim Payne, these orders should be placed in the Canadian order books this year. In addition to orders from Alectra Utilities Corporation, Canada's largest municipal power utility in terms of customer base, dynaCERT welcomed internationally renowned mining companies such as Nexa Resources, Vale S.A., CODELCO, Arauco, Sigma Alimentos and Antamina as new customers.
The Company leader also expects a positive conclusion for Verra's Verified Carbon Standard ("VCS") program. The licensing would pave the way for emissions trading with CO2 allowances; for dynaCERT, a scalable business with recurring revenues. In connection with carbon allowance trading, the Canadians are now looking to raise an additional CAD 10 million in the capital markets through the placement of carbon bonds to accelerate current and new potential deliveries worldwide. This includes Europe, Australia, North and South America, Asia and the Middle East. In addition to accelerating deliveries, the net proceeds are expected to be used for the working capital of a current HydraGEN technology business, timely delivery of its products, and research and development of its previously announced AEM electrolyzer innovations. That said, according to the press release, there may be circumstances in which a reallocation of funds is necessary for sound business reasons.
This is quite a clever move, especially with regard to the shareholder structure. After all, existing shareholders will not be diluted here, as the bonds cannot be converted into ordinary shares in the Company. A prerequisite for converting the issue bonds into share certificates, which will, however, only be possible in 5 years, is, of course, the approval by Verra. If, as announced, larger orders are landed in the next few weeks and approval for emissions trading is granted, the shares of dynaCERT should start to gain momentum again. Currently, the market capitalization is CAD 82.48 million.
The CEO of dynaCERT, Jim Payne, will be taking questions from investors on 7 December 2022 on the occasion of the 5th IIF - International Investment Forum. Participation in the virtual event is free of charge
Pathfinder Ventures - In summer and winter
It is never too cold to go camping; it is just a matter of wearing the right clothes. That is how visitors to Pathfinder Camp Resorts see it, too. Pathfinder currently operates three camping resorts in British Columbia and is focusing on both acquisitions and further development to expand its network. The half-year figures already showed the expansive growth of the camping resorts. Pathfinder Ventures increased revenues by 81% compared to the same period last year to CAD 917,000. Despite high investments, EBITDA improved from minus CAD 398,120 to currently plus CAD 54,395. At the end of the second quarter, the Company had a cash balance of CAD 1.58 million.
Surprisingly, winter camping is also finding enormous demand. The Canadians have reported a 47% booking rate for Q4 2022 and Q1 2023, a 9% increase over the same period last year. Winter visitors from across the country are choosing Pathfinder Camp Resorts for their winter getaways. To date, 96% of the winter vacation program's locations are already booked. The Company is planning to expand its capacity for next year.
In general, the signs at Pathfinder Ventures are all pointing to expansion. The Agassiz-Harrison facility is to be expanded through the purchase of a neighboring property. In addition, two further resorts are to be acquired. In the long term, the young company wants to profit from the booming market by purchasing and remodeling more facilities. The vision is also to install a franchise system.
The stock market value of Pathfinder Ventures is currently only EUR 2.54 million. Comparable companies in an advanced stage of development, such as Main Street Equities or Storage Vault, already have unicorn status.
SFC Energy - Largest order in company history
The demand for fuel cells seems to be unbroken. One of the leading suppliers of hydrogen and methanol fuel cells for stationary and mobile hybrid power solutions, SFC Energy, based in Brunnthal near Munich, Germany, received the largest order in the Company's history. The strategic follow-up order from LiveView Technologies USA forms the basis for a future presence in the United States. The order is for about 2,300 EFOY fuel cells for use in mobile surveillance technology. The order is worth around USD 15 million and will affect sales and earnings in equal halves in fiscal years 2023 and 2024. LVT already ordered more than 1,100 EFOY fuel cells as a new customer in 2021 and another 600 units in May this year.
The analysts of First Berlin Equity Research issued a price target of EUR 35 in their current study on the occasion of the Q3 figures and reiterated their "buy" recommendation. SFC Energy presented strong figures that exceeded analysts' forecasts. Although supply chain risks would remain, First Berlin experts believe SFC will beat guidance and have in-house forecasts for 2022 on.
The sharp correction in smaller stocks offers long-term opportunities for risk-conscious investors. SFC Energy could report a record order from the US. dynaCERT could break new ground following approval to participate in emissions trading. At Pathfinder Ventures, the high number of bookings for the winter season is surprising.
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