February 1st, 2022 | 13:47 CET
Lufthansa, TUI, Diamcor Mining, Aston Martin - Grab strong gains now!
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Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Lufthansa - What does the takeover of ITA Airways bring?
Opinions are currently divided on whether Lufthansa is already out of the woods or entering troubled waters again. Omicron is causing flight bookings to decline, and some states have closed the doors to tourism again. Business trips are also not suitable at the moment, as many things can be done by long-distance telephone.
Nevertheless, the German airline is looking for suitable partners in Europe. The airline wants to be prepared when the transition to the endemic season really gets underway. For this, it needs route and landing rights. Lufthansa would therefore like to acquire a stake in ITA Airways. The successor to the insolvent traditional airline Alitalia officially launched on October 15, 2021. ITA has since been operating on a tightly timed business plan that calls for it to gradually increase its staff and fleet by 2025.
The CEO of Italian carrier ITA Airways sees a possible alliance with Germany's Lufthansa as an important development opportunity. In our opinion, the arrangement makes perfect sense, as airlines are currently very favorably valued on the market, and ITA is building on the huge network of the former Alitalia with its offering. For Lufthansa, this could be a bargain. In any case, the crane share is valued at only EUR 8 billion with prices below EUR 7. Collect!
TUI - Excitement ahead of the figures for 2021
The European market leader among travel providers is stumbling in the pandemic. A EUR 500 million fund has just been established, which will be subscribed to by investors in the future as a financing vehicle. Background: TUI no longer buys its hotels itself but has new properties acquired by the fund. The fund then leases the hotels back to the tour operator. The step is unusual for the industry, but it is suitable to reduce financing costs, given the Corona-related environment. Of course, TUI needs an upcoming top summer or a significant increase in early bookings to finally return to operating profits. In addition, the high level of debt of around EUR 5 billion and the associated high interest charges continue to be major burdening factors.
For a technical rebound of the share, it is necessary that the pre-reported figures for the first quarter of 2022 on February 8 point in the right direction. The analysts' consensus estimate indicates an earnings turnaround to EUR 0.1186 per share. Most recently, a loss of EUR 0.0357 was reported. We are curious and waiting for the report confidently. Technically, the not-so-distant EUR 2.65 line is the most crucial barrier to the downside.
Diamcor Mining - Stable yield and good diversification
Far away from travel luxury, there is also a need for diversification on the investment side. From a portfolio point of view, it makes sense not to put all eggs in one basket in times of volatility. Canada's Diamcor Mining is one of the few listed diamond players. Large companies like De Beers should be familiar to most investors, as about one-third of the world's diamond market is dominated by the London-based South African Company.
Diamcor Mining owns the Krone Endora project in the middle of a large diamond district in South Africa. The Company has a long history of operations and production in Africa and has extensive experience in the production and supply of rough diamonds. Right next door, the aforementioned De Beers has been prospecting for decades at the Venetia mine, a flagship project of the Company. As announced by the South African government, many of the COVID-19 restrictions are now being gradually relaxed again.
In January, Diamcor mined approximately 3,103 carats of diamonds within the first batch for 2022. These rough diamonds, recovered from processing quarry material at the Company's Krone Endora at Venetia project, will be tendered in Dubai in the coming weeks. Work on the second mine expansion phase is expected to be completed by June 30, 2022. Exploration work will continue, as only 15% of the area under management has been further explored, but the exploration potential is still vast and promising.
Diamcor's share price stood at around CAD 0.35 at the end of the year, currently fluctuating between CAD 0.27 and CAD 0.37. The Company is cash flow positive. The story still has a lot of potential in terms of rising inflation and interest rates.
Aston Martin - Disappointing outlook and stumbling share price
Aston Martin owners are also among those with great resources and good taste. The British noble sports car manufacturer had to undergo a tough restructuring between 2015 and 2020. Daimler-Benz rushed to the rescue and took a stake of about 20% in the stumbling Company at the right moment.
The posh sports car maker surpassed its sales target for 2021 with an 82% increase in sales to 6,182 vehicles across its entire model fleet. However, the positive news was offset by the Company's admission that it will miss profit expectations. Aston Martin blamed that on weaker-than-expected sales in the fourth quarter. The Company said that only 10 Aston Martin Valkyrie and Valkyrie AMR Pro vehicles were delivered to well-heeled customers in the final quarter of the year. That's more than disappointing for the flagship model.
Adjusted earnings before interest, taxes, depreciation and amortization are expected to be around 15 million pounds lower than expected. However, management reiterated its medium-term targets of generating EBITDA of 500 million British pounds on sales of about 2 billion by 2025, possibly sooner. In the current year, however, the Valkyrie models and the new DBX derivative are expected to shake up the market for high-performance luxury SUVs. It could breathe life back into the share because with a loss of around 36%, the stock is right at the top of the 2021 list of losers. Collect below EUR 15!
Travel and luxury are a burden on the wallet if funds are tight. Inflation has its share in the misery. Nevertheless, shares from luxury sectors have a charm. Because if the environment improves again, then it goes up sharply there. Lufthansa, TUI and Aston Martin are classic turnaround stocks, and Diamcor Mining makes sense for diversification reasons.
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") currently hold or hold shares or other financial instruments of the aforementioned companies and speculate on their price developments. In this respect, they intend to sell or acquire shares or other financial instruments of the companies (hereinafter each referred to as a "Transaction"). Transactions may thereby influence the respective price of the shares or other financial instruments of the Company.
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