December 27th, 2024 | 07:40 CET
MicroStrategy buys Bitcoin! Nel ASA halved! F3 Uranium ultra-high grade!
The Bitcoin super-bull has struck again just before Christmas. MicroStrategy purchased an additional 5,262 Bitcoins, with an average price exceeding USD 100,000. However, the potential for a setback is increasing. The story is different for F3 Uranium, where new drilling results are described as "'ultra-high grade"'! This seems to prove analysts right. They see the fair value of the uranium explorer's shares as almost 200% higher than its current level. In contrast, experts have halved their price target for Nel ASA shares. For them, the former hydrogen high-flyer is no longer a buy, as the industry faces serious problems.
time to read: 3 minutes
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Author:
Fabian Lorenz
ISIN:
MICROSTRATEG.A NEW DL-001 | US5949724083 , NEL ASA NK-_20 | NO0010081235 , F3 URANIUM CORP | CA30336Y1079
Table of contents:
Author
Fabian Lorenz
For more than twenty years, the Cologne native has been intensively involved with the stock market, both professionally and privately. He is particularly passionate about national and international small and micro caps.
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F3 Uranium: Ultra-high grade results in uranium hot spot
The positive news flow at F3 Uranium continues in December. Further positive results from the 2024 drilling program have been released. This makes the breakout of F3 shares from the sideways trend that has persisted since September 2024 increasingly likely. The uranium explorer's shares are currently trading at CAD 0.24. Even before the latest results, analysts at Red Cloud Securities had recommended F3 Uranium shares as a "Buy" with a target price of CAD 0.60.
With the latest drilling results from the Patterson Lake North area (PLN), this target price is becoming increasingly realistic. Assays from hole PLN24-176 included 7.5 m of 30.9% U3O8, including an ultra-high-grade core of 4.5 m of 50.1% U3O8. In addition, the discovery starts encouragingly close to the surface at 190 m. This makes it the best drill hole in the JR zone to date. The Company considers uranium mineralization with assay results greater than 1.0% U3O8 high-grade and results greater than 20.0% U3O8 ultra-high grade.
F3 Uranium is active in a hotspot of the Canadian uranium industry. This brings several advantages: increasing probability of a successful project, reduction of costs due to existing infrastructure, and takeover speculation, as producing neighbours can easily expand their resources. The Patterson Lake North property is 4,078 hectares in size and is located on the southwestern edge of the Athabasca Basin in western Canada. In the immediate vicinity are the high-grade, world-class uranium deposits Triple R of Fission Uranium and Arrow of NexGen Energy.
Nel: Analysts halve price target
Stocks in the renewable energy sector are among the disappointments of 2024. These include, in particular, the former hydrogen high-flyers Plug Power and Nel. The industry is struggling with sluggish demand, and the two pure plays are examples of heavily loss-making business models. To "refresh" its stock market story, Nel has recently jumped on the nuclear energy bandwagon. The Norwegians will supply a 10 MW alkaline electrolyser plant to Samsung C&T Corporation Engineering & Construction Group. The Koreans plan to produce hydrogen from surplus nuclear power. However, this has yet to attract investors to Nel's stock. The share is trading just above NOK 2.90, close to its annual low.
Goldman Sachs analysts are also not convinced by Nel shares and are skeptical about the industry as a whole. Global demand is lower than analysts had previously expected. Orders are slow to come, and existing options are even being cancelled. The reason for this is regulatory uncertainty in the core markets of Europe and the US. As a result, the Nel share rating was downgraded from "Buy" to "Neutral". The price target was slashed from NOK 6 to NOK 3.
MicroStrategy: Bitcoin bull strikes again
What a year it has been for MicroStrategy shares! From USD 60 in January, the security shot up to around USD 500. Currently, the share is still trading at around USD 360. Company CEO Michael Saylor is one of the biggest Bitcoin bulls and has positioned the software company as one of the largest Bitcoin holders in the world in recent years. Shortly before Christmas, MicroStrategy made further purchases. It was reported that between December 16 and December 22, 2024, 5,262 Bitcoins were purchased for an average of around USD 106,662. As a result, Saylor has once again pumped more than half a billion US dollars into the crypto market. In total, the Company now holds 444,262 Bitcoins.
However, anyone calculating the value of the Bitcoin held by MicroStrategy will notice that its market capitalization, at USD 88 billion, is about twice as high. The rationale for investing in MicroStrategy rather than directly in Bitcoin is not particularly convincing. Even the recent inclusion of the stock in the NASDAQ index does little to change this. As a result, the stock is vulnerable to significant price corrections, especially if Bitcoin's value declines. Yesterday, the price of a Bitcoin temporarily slipped below USD 95,000.
Anyone who is convinced of the future of Bitcoin should consider a direct investment. At the current level, MicroStrategy appears to be significantly overvalued. By contrast, F3 Uranium is an exciting stock. If the positive news flow continues in the coming year, the Company will become a takeover candidate. The positive sentiment for the uranium industry should continue into the new year. In contrast, Nel shares are still not a compelling buy.
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