August 31st, 2023 | 08:30 CEST
Is the breakthrough coming? BYD, Plug Power, dynaCERT share in check
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"[...] We can convert buses and trucks to be completely climate neutral. In doing so, we take a modular and incremental approach. That means we can work with all current vehicle types and respond to new technology and innovation [...]" Dirk Graszt, CEO, Clean Logistics SE
dynaCERT: Hydrogen electrolyser for green steel in Canada
The dynaCERT share is currently trading near its low for the year. Wrongly? Quite. Because the newsflow is positive. In particular, the AEM electrolyser for green hydrogen offered jointly with Cipher Neutron is arousing interest among industrial customers in 2023.
Most recently, a cooperation with Strategic Resources Inc. was reported. As a first step, dynaCERT, Cipher Neutron and Strategic will evaluate whether the AEM electrolyser is suitable to supply green hydrogen to Strategic's metallurgical plant in Saguenay in the Canadian province of Quebec. The goal is to support the transition to green steel. Cipher sees significant revenue potential: For example, in Phase I, about 84 250-kW AEM electrolysers will be installed to produce about 10 tons of green hydrogen gas per day. Subsequently, he said, it is possible to double capacity to 200 250-kW electrolysers to produce up to 30 t of green hydrogen per day for the BlackRock project.
Sean Cleary, CEO of Strategic Resources, said, "*Cipher Neutron's AEM technology shows significant potential for fundamental change and is an excellent fit with the evolving hydrogen strategy of Strategic's BlackRock project. We look forward to integrating AEM electrolyser technology, much like that of Cipher Neutron, to promote a greener and more sustainable future in line with global greenhouse gas reductions. Strategic Resources has a long history of promoting green and sustainable technologies and welcomes the opportunity to be part of the development of the growing green hydrogen economy and support the transition to green steel for the Western world.
And dynaCERT has other mainstays. The Canadians have brought to market HydraGEN technology to reduce fuel consumption and emissions from commercial vehicles. In addition, recurring revenues are to be generated in the future through trading in emissions certificates.
BYD: Strong figures, but analysts remain skeptical
BYD also has a positive news flow. However, the share price is not making significant gains. The solid quarterly figures should be a liberating blow. After all, they are something to be proud of. With 1.255 million vehicles sold in the first half of 2023, the Chinese mobility group almost doubled the number from the same period of the previous year (H1 2022: 646,000 vehicles). Revenues rose from CNY 150.6 billion to CNY 260.1 billion in the period under review. Profit climbed 272% to CNY 10.95 billion. For the full year 2023, BYD expects to sell around 3 million vehicles, up from 1.86 million in 2022.
However, this did not convince all analysts. DZ Bank confirmed their buy recommendation and increased the price target slightly from HKD 305 to HKD 320. Jefferies is more skeptical. Their analysts also recommend buying BYD shares but reduced the price target from HKD 274 to HKD 263. Thus, they see only little price potential. Although the quarterly figures were in line with expectations, the competition in the e-car sector worries the analysts. An end to the price war initiated by competitor Tesla at the beginning of the year is not in sight. The competition among manufacturers will become fierce in the next three to five years. Although BYD is likely to be among the winners of the selection process due to its broad product pipeline, the battle will also leave its mark on the Chinese company.
Plug Power: Target price almost halved
Analysts are also currently skeptical about Plug Power. According to marketbeat.com, four analysts cut their price targets in August alone. The change at Roth MKM was particularly drastic. Their analysts lowered their expectations for the share of the hydrogen specialist from USD 13 to USD 7.50. At Trust Financial, the price target was reduced from USD 12 to USD 10, at Susquehanna from USD 15 to USD 14 and at BMO Capital Markets from USD 10.25 to USD 8. Currently, Plug Power shares are trading at around USD 8.90.
Nevertheless, 11 of 19 analysts listed on marketbeat.com recommend buying the stock. The average price target is USD 18.64. A year ago, however, it was USD 34.86.
Can stocks like BYD, dynaCERT, and Plug Power bring joy back to investors in the fall? The current sentiment is certainly an encouraging contraindicator. Positive news, such as those from BYD and dynaCERT, are being overlooked. At Plug Power, more and more analysts are losing hope. This could be the breeding ground for rising prices.
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