August 15th, 2022 | 13:32 CEST
GreenTech shares: BYD, Alpha Copper, Nordex, JinkoSolar - Top stocks for the climate fight!
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"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC
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.
BYD - The Chinese are setting course for Germany
The Chinese electric car manufacturer BYD wants to gain a foothold in Europe, and the first deliveries have already been made in Norway. In the fall, BYD plans to sell its first cars in Germany, but we cannot imagine that yet. It resembles a revolution if Chinese producers are now vying for the favour of European consumers.
The market in Europe is difficult. High inflation and little disposable income are weighing on household budgets. Already in 2020, the auto industry in the EU saw a record drop in new registrations due to the pandemic. In 2021, the crisis was compounded by the global semiconductor shortage. The European Automobile Manufacturers Association (ACEA) reported that only 9.7 million new cars were registered that year, down 2.4% from the already extremely weak previous year. The market leader in continental Europe remained the VW Group, which has a market share of a good 25% despite 4.8% fewer sales. As for 2022, we will know in the fall at the latest when the new models have arrived in the showrooms. New at the Paris Motor Show is BYD, with four brand new models from China. In Germany, they already have a trade partner, so the starting signal has been given.
BYD has attracted much attention in recent months, and the brand is truly in the fast lane. Vehicle sales grew 300% in the first half of 2022, despite the lockdown, chip shortages and supply chain disruptions. BYD's stock is running like the VW Beetle once did and, at EUR 120 billion, is now worth more on the stock market than Volkswagen. The 12-month gain is a remarkable 18.2%, and from a chart perspective, the value should not fall below EUR 33.
Alpha Copper - Promising discoveries in British Columbia
The energy transition and the increasing number of electric vehicles in the coming years are seen as long-term drivers for copper. Due to its unique properties, there is also no substitute for the reddish metal, and strong global demand, especially from China, is increasingly limiting its availability. One promising property is held by Canadian explorer Alpha Copper (ALCU) in British Columbia. The Company has access to a 60% interest in the Indata copper-gold project and a 100% interest in the Okeover copper-molybdenum project.
Several drill programs totaling 5,000 meters are currently underway in qualified porphyry copper-gold-molybdenum mineralization at the Indata Project. The geophysical targets appear highly prospective to date. Initial drill holes show veins of gold-bearing mineralization and adjacent molybdenum mineralized porphyry bodies. CEO Darryl Jones notes, "There has been a lot of smoke on the property over the years, and the way the current drill program is going, we believe we will find the fire and thus unlock significant asset value for our shareholders."
Alpha Copper's corporate goal is to contribute to the green economy with critical metals. ALCU's stock is currently trading very actively and has rallied from CAD 0.25 to CAD 0.50 in just 6 weeks. However, with a market capitalization of EUR 18.5 million, the story is arguably only just beginning and should still provide shareholders with plenty of joy.
Nordex SE - Is the turnaround now coming after the last capital increase?
Wind turbine manufacturer Nordex is a large processor of copper and other metals. The Company has already had to ask its shareholders to pay twice in 2022 because, so far, it has not made a profit on its wind turbine projects. Because of the high costs, the GreenTech manufacturer is already under margin pressure when contracts are signed because too many imponderables simply leave too little room for a profitable business. In the last profit warning, shareholders were again prepared for a zero profit year.
The main problems remain the problematic supply chains, the high-cost burden at the German location and the increasing competition because many companies want to earn money from climate change and contribute to the alternative energy supply. In recent weeks, however, the operational picture seems to be brightening again. There are currently large orders from Finland, where Nordex is supplying a further 27 turbines for the "Matkussaari" wind farm. Nordex already reported a major order for Finnish wind farms in March. In 2021, a record number of new wind turbines were built in Finland. A total of 141 new wind farms with a wind power capacity of 671 MW were thus erected last year. Nordex stock has gained a rapid 50% from its low of EUR 7 and is currently resting at EUR 10.50 for the time being. From a chart perspective, the first upward resistance is lurking here. Buy cautiously in weakness; the picture is brightening.
JinkoSolar - The green wave is becoming a sure-fire success
A prominent representative from the industry of regenerative energy production is the Chinese company JinkoSolar. In the first quarter, the operating subsidiary Jiangxi Jinko was floated on the stock exchange, and demand for the new stock was very high. With the USD 1.6 billion in capital raised, the group can now continue to scale and grow, as the Biden Climate Act in the Senate is expected to result in even stronger commitment from international governments.
JinkoSolar's solar module business has thus almost become a no-brainer. Currently, the Company has the most efficient modules, and its modern factories have been running at capacity for several months. In the first quarter, JinkoSolar reported a YOY revenue increase of 88.7%. The next figures are expected on September 7. After a fabulous rally to just under EUR 77, the share has recently corrected 20%. However, the traffic light is still green.
E-mobility and GreenTech are the top investment themes this summer. With the EU climate package and the passing of Joe Biden's USD 430 billion Climate & Health Bill, the sails are set for the related stocks. Copper stocks, such as Alpha Copper, are also among the long-term winners of this trend.
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