Close menu




June 2nd, 2021 | 11:34 CEST

Infineon, Defense Metals, Aixtron - It is getting tight!

  • RareEarths
Photo credits: pixabay.com

Supply bottlenecks in various industries, e.g. wood, metals, semiconductors or chips (see Infineon and Aixtron in this article), are causing prices to skyrocket. Whether only a short-term phenomenon, it remains to be seen. One area that is heading for ever-increasing demand with manageable supply is "rare earths." Particularly for producers or prospective producers or exploration companies, such as Defense Metals, this should pay off in the medium term.

time to read: 3 minutes | Author: Carsten Mainitz
ISIN: DE0006231004 , CA2446331035 , DE000A0WMPJ6

Table of contents:


    INFINEON TECHNOLOGIES AG - Analysts see 20% upside potential

    Infineon is Germany's largest semiconductor manufacturer and is among the TOP 10 in the industry worldwide. The Company was spun off from Siemens and floated on the Neuer Markt in 1999 as a high flyer. At currently around EUR 33 per share, the stock is still a long way from the high of just under EUR 80 at the time. But the bearish phase, partly as a penny stock, has also been left behind. Overall, analysts are currently optimistic about the share and forecast an average upside potential of 20%.

    Looking at the current developments and the raised outlook for the current fiscal year, one can only agree. Infineon offers semiconductor and system solutions with a focus on energy efficiency, mobility and security. The semiconductor market is booming thanks to the energy transition and digitalization. With sales of EUR 2.7 billion in the second quarter, the Group was 3% above the previous year. A weaker result was achieved at the operational level and the profit level. However, this reporting date view should not be overestimated.

    The Group described the current market situation by saying that demand exceeded supply in most fields of application. Infineon's factories were running at full speed and the Group was investing in additional capacity. As a result, Infineon has slightly increased its guidance for the fiscal year. The Group is now forecasting around EUR 11 billion sales with an operating margin of around 18%. Free cash flow is now expected to reach more than EUR 1.2 billion.

    DEFENSE METALS CORP - Drilling program to start soon

    The Canadian exploration Company Defense Metals is focused on advancing the Wicheeda Rare Earth Project, which covers approximately 1,700 hectares in the state of British Columbia. To date, the following indications of rare earth metals have been made on the project: indicated mineral resources of 4.89 million tonnes averaging 3.02% light rare earth elements (LREO) and suspected mineral resources of 12.1 million tonnes averaging 2.90% LREO. The latest 2019 drilling campaign of 13 holes and approximately 2,000 meters delivered good results.

    In May, the Company announced its intention to carry out a capital increase with gross proceeds of CAD 5 million. This will involve offering 15.625 million shares at a price of CAD 0.32 plus a whole warrant with an exercise price of CAD 0.425 and a 3-year term. The Company also announced further concrete steps to expand resources and delineate diamond drilling at Wicheeda at the end of May. Building on the success of the 2019 drill program, the deposit is to be extended northward. Defense Metals sees the potential here to uncover additional near-surface resources. The Company plans to drill at least 2,000 meters and up to 5,000 meters of diamond drilling to expand the deposit and further delineate existing resources. The next target will then be a preliminary feasibility study.

    The underlying conditions for the stock are entirely correct. Rare earths are in demand by so many industries and are becoming increasingly scarce. China's dominant market position in these critical raw materials generally leads to a desire for production to be established outside the People's Republic, thus making supply chains more secure. This is especially true for the defense industry, Defense Metals' focus sector. With a market capitalization of only CAD 22 million, there is currently a favorable opportunity to invest in the Company. Good newsflow from the drilling program should pay off soon.

    AIXTRON SE - Globally recognized and sought-after

    The Aachen-based company is familiar to older investors from the New Economic days of over 20 years ago. The Company entered the trading floor in November 1997. In the phase of stock market euphoria, the share price shot up to EUR 80 in the following years and then crashed to below EUR 3. Today, after an eventful history, the share price is around EUR 17. The Company is thus valued at just under EUR 2 billion. What does Aixtron do? Aixtron is a specialty machinery company and is one of the world's leading suppliers of deposition equipment for the semiconductor industry, both to produce on an industrial scale and provide equipment for research and development (R&D) and pre-series production.

    The devices produced are used in a wide range of innovative applications, technologies and industries. These include, for example, laser, LED, and display technologies, data transmission, communications, signal and lighting, and many other demanding high-tech applications. Demand is rising steadily, which is why the Company is repeatedly traded as a takeover candidate due to its market position. The driver of demand remains the desire for higher energy efficiency, processing and transmission speed of data, and 3D sensor applications and innovative display technologies.


    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on news.financial. These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered here. Please also note our Terms of use.


    Der Autor

    Carsten Mainitz

    The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.

    About the author



    Related comments:

    Commented by Nico Popp on December 21st, 2021 | 10:14 CET

    BYD, Defense Metals, Nordex: Opportunities in a weak environment

    • RareEarths

    New technology requires new raw materials. The evolution of modern batteries for e-mobility alone shows how different the raw material requirements are depending on the technology used. First, cobalt was the battery metal; now, tungsten and silicon are increasingly important. Rare earths have also always been in demand for future technologies. These are used in displays and many other applications and have long since achieved the status of critical metals. We present three companies that are active in the field of rare earths.

    Read

    Commented by André Will-Laudien on December 13th, 2021 | 11:36 CET

    Standard Lithium, Defense Metals, Nordex - The demand for metals goes through the roof!

    • RareEarths

    A possible explosion in raw material prices was already indicated in 2019. Due to low selling prices, some mining companies even reduced their mining output or stopped their exploration activities. Then came the pandemic, which put further pressure on both production and logistics, and many operations had to close for longer than expected due to adjustments in sanitation infrastructure. There is now also the supply chain problem in this already tight supply situation. Presumably, things will not get any easier in 2022 under these conditions. Which companies are making a name for themselves in this environment?

    Read

    Commented by Armin Schulz on December 8th, 2021 | 10:34 CET

    NIO, Defense Metals, BASF - Trade war with China

    • RareEarths

    Didi Global's delisting on the New York Stock Exchange after less than six months of membership shows, on the one hand, the tremendous regulatory fury of the Chinese government, but on the other hand also the tensions between the USA and China. This trade war has been going on since 2018, and even the change in the US presidency has not brought any relief. At least both sides exchanged views in mid-November and do not want a cold war. China has also warned Europe against too much independence. However, since the Corona Crisis, it has become clear how dependent many countries are on China. A rethink is discernible, also because high container costs mean that imports are no longer profitable in some cases. Today we look at three companies that are at least indirectly affected by the trade dispute.

    Read