Evotec downgraded! Out of Hensoldt? Into Pure Hydrogen?

Pure Hydrogen: What is going on?

Pure Hydrogen's share price has seen high volatility in recent days. Initially, the suspension of trading at the end of last week caused uncertainty. But it is not as bad as feared; the Company simply paused trading to raise capital for its next growth phase.

Pure Hydrogen is on an expansion course and has ambitious goals: The Australians want to become a leading provider of sustainable drive solutions. To this end, they are focusing on a range of technologies – from battery-electric and hydrogen fuel cell vehicles to refueling solutions and mobile production facilities in shipping containers. In this context, the Company plans to rename itself Pure One at the upcoming annual general meeting.

While Nel and Plug Power are experiencing a lull in orders, Pure Hydrogen recently reached its next milestone: In the US, it has signed a letter of intent with California-based GTS Group for the delivery of heavy-duty fuel cell trucks. Specifically, this involves Class 8 tractors for long-distance transport and special vehicles for waste disposal and concrete mixing. The first units are scheduled for delivery in the fourth quarter of 2025. The deal opens the door for the Australians to the world's largest commercial vehicle market. Managing Director Scott Brown sees this as an "important lever for scaling," especially since GTS has a strong distribution network and an established leasing program. Pure Hydrogen had already gained a foothold in July with its sale to Riverview International Trucks in the US.

The share price is likely to stabilize again soon and then continue its upward trend.

Sell Hensoldt and Buy Rheinmetall?

Sell Hensoldt and buy Rheinmetall? At least indirectly, that is what Barclays is advising. While analysts recommend Germany's largest defense contractor with an "Overweight" rating and a price target of EUR 2,050, their assessment of the radar systems specialist is more cautious. Fundamentally, the Company has a strong position in the radar and optronics sectors. However, given the order backlog, experts believe it will take a little longer for Hensoldt to achieve faster revenue growth. Against this backdrop, the stock appears to be too expensive, with other defense stocks looking more attractive. Barclays' price target for Hensoldt shares is EUR 88, which is in line with the current level. Accordingly, the stock is rated "Equal weight."

Barclays analysts are not alone in their cautious stance. According to marketscreener.com, only 4 out of 12 experts recommend Hensoldt shares as a "Buy." In addition, there are 6 "Hold" ratings and even 2 "Buy" recommendations.

Evotec: Out of the MDAX and also out of the stock?

While BioNTech is increasingly positioning itself as a cancer-fighter, Evotec's stock continues to struggle. The momentum generated by the new strategy has fizzled out, and even insider purchases by the management board have so far failed to trigger an upward trend in the stock.

Last week, Deutsche Börse announced that Evotec would have to leave the MDAX on September 22 and would be included in the SDAX in future. The biotech company will replace eyewear group Fielmann in the small-cap index. The German biotech company's share price has now slipped back below EUR 6 and is approaching its multi-year low from April 2025.

Even a bullish analyst comment failed to have an impact. RBC sees great hidden value potential. The deal with Sandoz is an example of how the big pharmaceutical companies appreciate German technology. As part of its realignment, Evotec announced its intention to divest itself of peripheral areas. In July, it announced a non-binding agreement with Sandoz regarding the possible sale of the French site of its subsidiary Just. Evotec would receive around USD 300 million for the site. In addition, further technology-related considerations, future development revenues, milestone payments, and product license fees are planned. From the perspective of RBC analysts, Evotec is implementing its strategy change quickly. They confirmed their "Outperform" rating for Evotec shares and reduced the price target slightly from EUR 11.90 to EUR 11.20.

Although Evotec appears to be implementing its change in strategy quickly, it is clearly not resonating with many investors at present. There is currently no compelling reason to buy the stock. In contrast, Pure Hydrogen may offer an exciting buying opportunity. With further orders, the stock is unlikely to remain at these levels for long. Meanwhile, Hensoldt's valuation currently looks stretched. This is particularly true given that the technology company appears unable to accelerate revenue growth as quickly as hoped. In the short term, other defense stocks are likely to be more attractive.