26. November 2021 | 10:39 CET
Hochtief, TalkPool, Bilfinger: Real estate shares and the new German government
The coalition agreement of the new German government reads ambitiously and met with a positive response from the real estate industry. Above all, the planned reduction in bureaucracy and digitization should be in the interests of all concerned - after all, analog land registers repeatedly cause errors and delays, which are quickly expensive, especially in construction. But the coalition's plans also include greener construction and stricter regulations on insulation and heating. We present three stocks and explain whether they will benefit or not.
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ISIN: HOCHTIEF AG | DE0006070006 , Talkpool AG | CH0322161768 , BILFINGER SE O.N. | DE0005909006
Hochtief: Skilled workers urgently sought
Hochtief is the largest construction group in Germany. If you ever look out for the eye-catching logo on major construction sites, you will often see it. Hochtief stands for planning, financing and operating construction projects - regardless of size. The Company is also represented in the USA and Australia and generates around 63% of its sales in North and South America. The second most important pillar is Asia with about 30%. Europe accounts for approximately 5.5%. The plans of the German traffic light coalition are therefore unlikely to change Hochtief's business. However, it can be assumed that the trend towards more thermal insulation and sustainability will also spread internationally in the construction sector.
Regardless of how the future government in Germany acts, large companies like Hochtief are likely to be ideally placed to implement the new requirements or profit from them in the transition phase. Companies that are large and can plan accordingly have an advantage even under difficult regulatory conditions. Hochtief's stock currently boasts a low valuation and a healthy dividend yield of around 5.5%. The order situation is good, but the potential at Hochtief is also limited: How hard it is to get good artisans is currently evident not only in Germany.
TalkPool: Smart buildings to bring growth
Unlike Hochtief, the Swedish Company TalkPool is still small but operates in exciting areas and is increasingly rolling out its business internationally, as demonstrated by its recent market entry in the USA. TalkPool offers solutions for the Internet of Things and has set the goal to make buildings smart and save energy through networking. TalkPool's solutions also ensure, for example, that water damage can be detected at an early stage. That saves money in the end. Every homeowner can tell you a thing or two about how expensive water damage can be - not to mention the limitations involved in repairing it.
As another mainstay, TalkPool works with telecom providers to make telecom antenna towers more affordable and better suited to their surroundings - making them less disruptive and easier to place within residential areas. Most recently, TalkPool announced the delivery of air purification systems to two schools in Leipzig. The goal: to filter the air and reduce CO2 emissions. TalkPool emphasizes that the solutions are also suitable for other buildings, such as offices. Recently, the Company announced encouraging figures for the first nine months of the year. Among other things, revenues increased by 19.4% to EUR 17.77 million, and EBITDA reached EUR 0.78 million, representing a margin of 4.4% compared to 3.3% in the same period last year. Coupled with the changing environment around the world, the small Company could accelerate its growth trajectory. The conditions for this have improved since yesterday with the new coalition agreement.
Bilfinger: This dividend is convincing
Bilfinger is also considered a German stock around construction and real estate. However, the Company drastically scaled down its construction activities a few years ago and now sees itself as a service provider for industry. Most recently, even the building subsidiary changed hands. The business includes the maintenance of manufacturing plants and serves customers from all sectors. Thanks to long-term contracts, the Company has succeeded in making what is actually a very cyclical business a little more stable. Bilfinger also benefits from its good reputation and name. In addition, the Company boasts a dividend yield that currently stands at around 6% - in return, conservatively oriented investors can accept slightly lower price potential.
Especially for dividend hunters, the shares of Hochtief and Bilfinger offer good opportunities. However, the potential for price increases is limited. Nor is the focus entirely on "green" construction. TalkPool is a different story. The combination of Internet of Things solutions for buildings and the telecommunications business sounds appealing. Now the business just needs to ignite noticeably. If you are looking for dynamism and are not afraid of risk, you can make a note of TalkPool's share.