19. August 2020 | 08:20 CET
dynaCERT, TUI, Varta - where is it worth investing now?
The Corona Pandemic has changed society and the economy in recent months. Topics such as social distancing did not exist in this extreme way before and has, for example, turned the travel industry upside down. As a result of government rescue measures, airlines and travel companies had to be provided with liquidity so that the systemically important corporations did not slip into insolvency through no fault of their own and much larger and more uncontrollable losses were caused by a domino effect. But a lot has also happened in the technology sector and there are exciting developments that can be lucrative for investors.
time to read:
ISIN: CA26780A1084 , DE000TUAG000 , DE000A0TGJ55
Partnership in the fight against climate change
The Canadian technology company dynaCERT has brought an innovation to the market that makes existing diesel engines more environmentally friendly. The technology uses hydrogen as a catalyst and can therefore reduce the emission of pollutants. In addition, fuel consumption is reduced and, in addition to environmental protection, an economic advantage is created.
dynaCERT recently announced that the company's HydraGEN (TM) units will now also participate in the United Nations program called "United 4 Smart Sustainable Cities". This means that dynaCERT is now an official partner of the United Nations in the fight against climate change in cities around the globe. Some 200 cities around the world have already joined the program, including capitals in Europe, Asia, the Middle East, Africa and North and South America. This partnership offers the company enormous sales and profit potential. The analysts of GBC see a price potential for the share of EUR 2.20.
Setback due to travel warnings
The German TUI Group clearly felt the effects of the travel restrictions and is therefore eligible to participate in the so-called Corona Shield of the German government. The largest aid package of the Federal Republic of Germany enables payments to be made via the state-owned Kreditanstalt für Wiederaufbau (KfW). In the second quarter of 2020 TUI has already received a payment of EUR 1.8 billion. Due to the ongoing precautionary measures the travel industry is still severely restricted and TUI requires a further credit line of EUR 1.05 billion from KfW.
Against the background that the number of Covid-19 infections is on the rise again in many holiday regions, the industry is still far from normal travel behaviour. The travel warning issued by the German Foreign Office for Spain was a severe setback for the industry, as destinations such as Mallorca are among the most popular holiday destinations.
Competence and growth
The shares of battery manufacturer Varta can benefit from the trends of cordless headphones and the electrification of mobility. The business with lithium-ion cells is booming and the company was recently able to adjust its expectations for the current fiscal year upwards. Sales are expected to increase by up to 129% year-on-year to EUR 810 to 830 million, exceeding the previous estimate of up to EUR 800 million.
With a market share of over 50% in rechargeable batteries for headphones, Varta's competence is undisputed and this market is extremely interesting due to its annual growth of up to 40%. Varta has received EUR 300 million from the German government for research and development and the first industrial application of next generation lithium ion cells. The analyst von Berenberg has raised the target price of the share from EUR 120.00 to EUR 140.00 and left the rating at 'buy'.