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October 4th, 2021 | 10:06 CEST

NEL, GSP Resource, China Evergrande: How to find the doublers

  • Copper
Photo credits: pixabay.com

Speculative investments are the salt in the soup on the stock market. Of course, those who rely on ETFs and funds over the long term via a savings plan can already do a lot better than the vast majority of savers. However, those who develop a good knack for speculative individual stocks can give their portfolio a growth kick. Even if many newcomers to the stock market can hardly believe it: 100% and more is possible. Using three stocks as examples, we explain what is important and what is not a good prerequisite for investment.

time to read: 3 minutes | Author: Nico Popp
ISIN: NEL ASA NK-_20 | NO0010081235 , GSP RESOURCE CORP. | CA36249G1090 , CHINA EVERGRANDE GROUP | KYG2119W1069

Table of contents:


    Ryan McDermott, CEO, Phoenix Copper
    "[...] If we pursue our goals conscientiously, the market will adjust its valuation accordingly, I am sure. Often, all it takes is a trigger. [...]" Ryan McDermott, CEO, Phoenix Copper

    Full interview

     

    NEL: From Paul to Saul?

    The NEL share is one of the investor favorites of 2020 and the first quarter of 2021. Why? It is where future fantasy and stock market hype came together. NEL focuses on hydrogen storage and transportation. In the past, the Company has already received one or two orders for hydrogen filling stations. Most of these were smaller orders, which hardly bear any relation to NEL's valuation, which is worth billions. But the stock market did not care at the time - the prices rose and rose. And this is precisely where investors should pay attention.

    NEL is the best example of a hype stock. When hydrogen was the next big thing, even a small order with a volume of a few million EUR caused a share price explosion. If there are these orders, there is bound to be more, the market thought and cheered NEL's share price up. Between January 2020 and January 2021 alone, NEL more than tripled in value. Since then, the wind has shifted. The major automakers are focusing on electromobility and have turned their backs on fuel cells for passenger cars. Since then, the market has also focused on concrete figures. Orders for NEL are examined much more critically today, and their volume is immediately interpreted in the light of the evaluation. The result: the share has been stuck in a downward trend since the turn of the year. Around EUR 1.30, the value keeps fighting against further decline. NEL is currently no longer a good choice for speculative investors.

    GSP Resource: Mini market capitalization + clear strategy

    GSP Resource is anything but a hype stock. But that does not mean the share does not have great growth potential. GSP Resource is focused on its Alwin mine, a historic project with the potential to produce copper, gold and silver. What makes Alwin unique is its location: only about 3 km away is the open-pit mine of Teck Resources Highland Valley, a property so extensive, including its tailings pile, that it can be seen from space. GSP Resource's strategy is clear: the Company wants to explore its Alwin mine further to spruce it up for a possible acquisition. With grades of 1.29% copper equivalent over 14.1 meters, this has already worked well in the past. Most recently, GSP Resource went one better with grades of 4.42% copper, 3.5 g/t gold, 92.8 g/t silver and 0.14 ppm rhenium (6.15% copper equivalent) over 4.4 meters.

    While GSP Resource's plans are in the early stages, both drill results and the location of the Alwin mine suggest potential. Because GSP's strategy from the outset has been to make the project attractive to potential buyers, the Company also has an attractive cost structure. It is not beating around the bush on ancillary issues. It is solely about making the mine attractive to buyers. The stock has been running sideways for months, but it has also proven suitable for dynamic developments. With a valuation in the low single-digit millions, GSP Resource offers an attractive risk-reward ratio for those who like growth companies and can allocate these stocks with foresight as part of a diversified asset allocation.

    China Evergrande: Better go to the casino!

    One Company that hardly anyone knew about until a few weeks ago, but which is now attracting gamblers, is China Evergrande. The real estate developer is heavily in debt and has its back to the wall. Most recently, the Company has been unable to make some interest payments, and it still looks as if Beijing does not want to save the huge Company. The stock is riding a roller coaster between hope and fear. Similar cases in the past have been Adler Modemärkte and other insolvency gambles. While these stocks can gain 50% in value within hours, they are unpredictable. Investing in these stocks is like playing musical chairs - the last one to bite the dog.


    Instead of betting on insolvency stocks such as China Evergrande, investors should prefer unknown stocks. Here, the company's success can be achieved step by step and independently of tight deadlines or even court dates. The best example of such a company is GSP Resource. Stocks like NEL are a safe bet for gamblers - but only as long as the wave is still breaking. Once the hype is over, speculative investors would be better off surfing elsewhere.


    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") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

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    Der Autor

    Nico Popp

    At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.

    About the author



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