Insider Alert at Deutz! Buy Recommendation for Renk! Drone Potential at HPQ Silicon!

HPQ Silicon: When Will the Share Surge?

At the beginning of the year, HPQ Silicon's stock would likely have skyrocketed. Back then, the market loved drone stocks, and DroneShield, for example, doubled in value within a few weeks. Currently, little remains of that euphoria. But that is precisely where the opportunity lies for HPQ. After all, the news flow is strong.

Most recently, HPQ Silicon and its strategic partner Novacium, in which HPQ also holds a stake, delivered a total of 30 specially configured battery packs to three European drone manufacturers. Each manufacturer received 10 packs for the final testing phase prior to potential product qualification and integration into their respective drone platforms. The configurations were customized based on previous tests as well as the customers' technical and operational requirements.

Novacium's proprietary GEN3 and GEN4 silicon anode technology is being used. It is designed to enable a higher energy density than conventional cells with graphite anodes while also meeting the drone industry's requirements for safety, reliability, and durability.

The three evaluation programs have been running since the fourth quarter of 2025 and have now simultaneously reached the final planned test phase. Novacium intends to use the feedback from the manufacturers to further optimize the battery packs and prepare for potential product qualification. HPQ benefits through its stake in Novacium and also holds the exclusive North American license for its technologies.

This is already the second success story in just a few weeks. Previously, HPQ Silicon and Novacium had announced the first commercial order for their GEN3 battery packs. The French Army has ordered 6S1P packs with a capacity of 6,000 mAh for one of its regiments' FPV drones. The order followed several months of performance and reliability testing. Following successful testing, this marked the first step toward a concrete defense application and, at the same time, entry into the supply chain of France and NATO. Thanks to its higher energy density, the silicon-based anode technology is expected to enable longer ranges, higher payloads, or a balanced combination of both advantages.

https://youtu.be/V6FO2uPdQLI?si=krfrV3gpZFo5xt5e

Deutz: Insider Buying

While HPQ shares are still in the starting blocks for a rally, the rally at Deutz is in full swing. The engine specialist is currently undertaking a major acquisition and going all-in on defence. The Cologne-based company's stock has gained over 22% in the past month alone. Year-to-date, the stock is up 50%. And even at this level, insiders are still buying. Most recently, Patricia Geibel-Conrad reported a purchase. On August 28, she bought shares worth EUR 103,000. The average price was EUR 12.89.

On the operational front, Deutz recently announced a strategic partnership with the Indian engine manufacturer Kirloskar Oil Engines (KOEL). With this move, Deutz is expanding its offering for highly regulated markets to include a compact 1.6-litre series and is tapping into the power segment below its previous entry-level 2.2-litre class. The partnership is specifically designed to address the trend toward smaller engines and the growing demand for compact powertrain solutions.

The water-cooled three-cylinder engines will be offered as the naturally aspirated D1.6 and the turbocharged TCD1.6, covering a power range from 18 to 41.2 kW. Planned applications include construction machinery, material handling, and industrial applications. The first variant is expected to hit the market in the first quarter of 2027.

Renk: Analysts Rate the Stock Highly

Renk is among the defence stocks that are currently underperforming. The gear specialist's stock fell 15% last month and 22% over the past year, and is currently trading at around EUR 43. From mwb research's perspective, the stock is therefore relatively undervalued. Analysts have upgraded the stock from "Hold" to "Buy", and the price target remains at EUR 48.

Following the price decline, the risk of a revenue decline due to the high proportion of still-uncertain orders in the order backlog is now much better reflected in the share price. The valuation model assumes an 18% decline in revenue from the expected peak and a proportional decline in free cash flow.

Analysts see additional potential in the maintenance, repair, and spare parts (MRO) business. However, for this segment to significantly alter the assessment, Renk must first build up a sufficiently large installed base. In the short term, the German government's expected decision on the approximately EUR 25 billion Boxer/Arminius contract could boost the entire defence sector. Rheinmetall and KNDS are set to serve as manufacturers for this major project.

Following the decline in the share price, the valuation has, according to mwb, fallen back to the level seen at the end of May. For 2027, Renk is valued at a price-to-earnings (P/E) ratio of 20 and an EV/EBITDA multiple of 11. By 2030, these metrics could drop to approximately 11 and 6, respectively. Analysts also expect a dividend yield of more than 4% for 2030. Overall, mwb considers the current price level attractive, as a potential peak in defence spending in the early 2030s is already adequately priced in. However, the upside potential is also modest.

HPQ Silicon appears poised for a share price jump. The news flow would certainly justify this. Investors who buy now and exercise some patience could be rewarded. Deutz is one of the year's high-flyers. If the major acquisition goes through, the stock likely has even more upside. At Renk, however, there is currently no compelling reason to buy.