September 2nd, 2021 | 12:15 CEST
Heidelberger Druckmaschinen, Troilus Gold, TUI: The Power of Transformation
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"[...] Our projects are at the initial, high reward exploration stage. [...]" Humphrey Hale, CEO, Managing Geologist, Carnavale Resources Ltd.
At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.
Heidelberger Druckmaschinen: Innovative like Elon Musk
The Heidelberger Druckmaschinen share fought its way back into the stock market Bundesliga in 2021 - at times, the venerable Company from Neckarstadt had even become a penny stock. But the Heidelberg company made a virtue out of necessity. In addition to the digital transformation, which the Company from the printing industry has been driving forward for many years, it entered the wallbox business. The offer: charging infrastructure for business customers, parking garages and, in the future, smart homes in the private sector. As recently as January, Heidelberger Druck doubled its capacity, and in June, it went one better with a new production line. Heidelberger Druck has recognized its opportunity and is doing everything it can to take advantage of it.
Since charging infrastructure is subsidized by the state and electric cars are becoming the standard, Heidelberger Druck's decision to move in this direction is right. The Company already has a 20% market share in charging stations - there is no longer any question of a stopgap solution. The Company still has little equity and must therefore be considered fragile. However, the course for a promising future has been set. Heidelberger Druck shows how transformation works.
Troilus Gold: Production costs of USD 850
The Canadian Company Troilus Gold is also in the midst of a transformation process. The Company operates on the site of a historic mine in Québec. The mine was previously in production but at significantly lower quotations of gold. However, the owners at the time had a different focus and did not invest enough in exploration. Troilus Gold is now taking advantage of this and wants to leverage the omitted potential of the past. The aggressive exploration shows that this is not just lip service: the Troilus Gold team has drilled around 250,000 meters in recent years and documented a resource of 8.1 million ounces of gold. The end goal is to have a mine that will produce gold and copper for more than twenty years. "If we invest CAD 350 million, we can produce 250,000 ounces of gold annually over 22 years, as well as appreciable copper deposits. The cost of extraction for gold is USD 850 per ounce - that is a very comfortable situation given the current price of gold," CEO Justin Reid said in a July interview.
Troilus Gold raised capital a few months ago. The Quebec government indirectly participated in the financing. Reid and his team see this as a great sign of confidence in the project. The Company leader sees Troilus Gold as well-financed with around CAD 55 million in the coffers amid a transformation phase that gradually lowers the project's risk. For investors, this could create great opportunities. "We have a lot of resources. We are heading towards a final feasibility study, and we are publishing regular drill results. These are all events that show the market that the risk of our project is diminishing bit by bit," Reid summarized. The stock has been moving sideways for a year and has shown weakness recently. Investors may consider getting a foot in the door at Troilus on attractive terms, given the project's positive key data.
TUI: What is next?
Many Germans put their foot in the door in recent months by booking a package tour. Unfortunately, the Delta variant spoiled many trips abroad and ensured that popular destinations became risk areas. Although vaccinated and recovered people are largely spared restrictions, the once smoothly running package vacation is still associated with some thrills because of Corona. The tour operator TUI is also feeling the effects of this.
Just months ago, the Company was hoping for a successful summer. It is now likely to be not quite as successful as expected. The Company, which has been rescued by the state, still has some uncomfortable months ahead of it. But it is also clear that travel will settle down under Corona conditions. However, the TUI share will only really enter positive waters beyond the EUR 5 mark. Currently, there is too much uncertainty associated with the stock.
While Heidelberger Druck is successfully moving into new business areas, TUI has to struggle with the existing conditions. Both companies are in trouble, but Heidelberger Druck seems to have the advantage. The development of Troilus Gold could be even more dynamic. Here, good conditions for raw material production meet a secure location and a long mine life.
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