March 20th, 2023 | 08:45 CET
Meta Materials and Palantir for the future, what is Commerzbank doing?
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Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.
Meta Materials - More than 500 patents filed
Meta Materials, a company listed on the NASDAQ, has brought new high-performance functional materials and nanocomposites from the laboratory to mass production. Just how innovative the Company is is underscored by the February 15 announcement. Meta Materials has been awarded another US patent for lithium batteries, targeting the use of novel separators such as the NPORE nanoporous ceramic separators. That brings the total number of patents filed to 501, of which 315 have already been granted. The potential applications seem almost unlimited, but the focus at the moment is on optimizing performance and safety in electric cars and in the field of nano-optical safety, which is responsible for most of the revenue.
The most recent order, dated February 16, came from its G10 central bank customer. The USD 855,000 order is part of a contract for up to USD 41.5 million over an expected five-year period. Nano-optics technology can significantly reduce counterfeit banknotes. The Company plans to enter the global market with its technology in 2023. In battery optimization, the Company is working with DuPont Teijin Films and Mitsubishi Electric Europe to develop series production. PLASMAfusion technology is expected to reduce the weight of the copper foil used in batteries, which accounts for 10% of the weight of a battery cell, by 80%. In this way, both efficiency and safety will be increased, while costs will be saved.
Sales had increased significantly in previous quarters; however, Q4 sales fell YOY to USD 1.4 million. The Company plans to provide official figures by the end of March, as accounting for the spin-off from Next Bridge Hydrocarbons will take some more time. At the same time, research and further development of technologies consume money. On February 10, it was announced that the Company plans to raise up to USD 100 million via the issuance of shares at the market price. This news sent the share price on a downward slide. The current price is USD 0.4976 per share. If the Company succeeds in optimizing the batteries of electric cars and bringing them into series production, the share should achieve a turnaround.
Palantir - Analyst expectations exceeded, but share price still falls
Palantir Technologies is considered one of the most innovative and advanced technology companies in Silicon Valley. Its core competence lies in data analysis, and Palantir has developed software engineering solutions for this purpose. Originally, the platform was used by intelligence agencies. However, the products are now also used by many large companies, government agencies and non-profit organizations to process large amounts of data quickly, accurately and securely. As more and more companies rely on Big Data analytics daily, there is great growth potential. This is evident in the Company's Q4 numbers. The Company posted a positive GAAP net income of USD 31 million and saw total revenue increase 18% YOY to USD 509 million. The number of customers increased 55% YOY and 9% quarter over quarter. In FY2022, total revenue increased 24% YOY to USD 1.91 billion, with US revenue increasing 32% YOY to USD 1.16 billion. Adjusted operating income was USD 421 million, representing a margin of 22%.
Although this exceeded analysts' expectations, the Company cut 2% of its jobs to adjust to the weaker-growth market environment. On March 8, it announced a contract worth up to USD 99.6 million over 5 years. This will involve providing Palantir software to the Bureau of Medical Services of the US Department of State. Despite the good figures, the share has fallen by more than 20% since the quarterly figures. The share is trading at USD 7.88. That puts the price-to-sales ratio at around 9, which is considered attractive for a growth company.
Commerzbank - Strong year 2022
On February 16, Commerzbank reported its financial results for 2022, announcing the highest net profit in more than 10 years. In total, the bank generated around EUR 1.4 billion, exceeding its targets by EUR 400 million. Commerzbank plans to pay a dividend of 20 cents per share and implement a share buyback program of EUR 122 million. For 2023, net income is expected to exceed that of 2022, and a payout ratio to shareholders of 50% is targeted. The transformation into a digital advisory bank is almost complete.
The world for Commerzbank shareholders was rosy at this point. Rising interest rates also meant rising revenues. But then Silicon Valley Bank's share price plummeted on March 9, and shortly after that, Credit Suisse also ran into trouble. Memories of the 2008 financial crisis were awakened, and the entire banking sector was hit hard. Now the FED's interest rate decision is due this week, and experts are hoping for a cut in the interest rate. That would ease the situation for banks somewhat, but at the same time, such a decision would be bad for Commerzbank's business.
Currently, bank shares are arguably the hottest item on the stock market because it is often not known how the banks have invested their surplus cash. On the other hand, there are opportunities now. Commerzbank has already done its homework and cut costs. At the same time, European banks are very well capitalized thanks to Basel III regulations. Nevertheless, the Commerzbank share fell by more than 24% at its peak and is currently trading at EUR 9.18. A very attractive level if you want to speculate on a rebound in the banks.
The growth companies Meta Materials and Palantir are still struggling with profitability. Meta Materials technologies can become real game-changers in many industries in the future. But the Company is not yet making money. Palantir has fought its way into the profit zone and is continuously expanding its customer base. Commerzbank is reporting great figures, but the negative banking environment is dragging down the share. The FED decision on Wednesday is certainly interesting for all three companies.
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