Close menu




June 9th, 2021 | 08:28 CEST

NEL, Troilus Gold, K+S: After the hype is before the hype

  • Gold
Photo credits: pixabay.com

For some time now, more and more private investors have been flocking to the trading floor. New, low-cost smartphone brokers and innovative technologies have attracted these investors. Hydrogen stocks, in particular, triggered a stock market boom in 2020. But what is next for these new stock market investors when the shares of NEL, Ballard Power and others no longer perform? Where are there still opportunities? We provide answers.

time to read: 3 minutes | Author: Nico Popp
ISIN: NO0010081235 , CA8968871068 , DE000KSAG888

Table of contents:


    Gary Cope, President and CEO, Barsele Minerals
    "[...] We are convinced that we could already leverage significant potential with a drilling program of around 35,000 meters. However, to finance this, we need a decision. Fortunately, there are already interested parties who can imagine advancing Barsele together with us. [...]" Gary Cope, President and CEO, Barsele Minerals

    Full interview

     

    NEL: Hydrogen veteran under competitive pressure

    NEL's stock was one of the high flyers in 2020, climbing from around EUR 1 to EUR 3.35 at the beginning of January 2021. NEL handles the production, storage and transport of hydrogen. For a long time, the Company was considered a good choice because of its comprehensive business model. Recently, however, some orders have slipped through the Norwegians' fingers. Even an order from the Spanish utility Iberdrola for the supply of electrolyzers, which was almost guaranteed, was lost. There are many reasons for this. Although NEL is considered technologically advanced, there is more and more competition on the market for hydrogen products. This competition often has entire corporations up its sleeve, which have completely different options for large-scale projects and financing. When customers have a choice, the lucrative orders are spread out - and top dogs like NEL are more often left out in the cold.

    In 2021, the stock has had a pitch-black year so far. In the last three months alone, the share price has fallen by 27.1%. If you look at the share over a year, you see a zero return - the entire hype of the past few months is already over on the stock market. So, where does NEL go from here? Experience with hype stocks shows that new rises are likely after such a sell-off. However, these rises usually do not take the stock back to the old highs. In the short and medium term, prices above EUR 2 would already be a surprise. Hydrogen is an exciting future technology, but the competition is already fierce and the NEL share is expensive. Stock market newcomers, in particular, should not hope for a brilliant comeback.

    Troilus Gold: Step by step towards production

    Unlike NEL in the hydrogen sector, Troilus Gold is not a hype stock. Instead, the Canadians are quietly accomplishing their work. Troilus continues to develop its namesake mine, which produced more than 2 million ounces of gold and 70,000t of copper between 1996 and 2010. Troilus believes that the mine was notoriously under-explored during its production - the operator at the time invested little in the project. Troilus is now taking advantage of this and is catching up on the work. Since January, Troilus has already drilled 21,000 meters and plans to drill another 10,000 meters each month over the summer. A steady newsflow and new prospects for the mine, which was already profitable at significantly lower gold prices, can thus be expected.

    From August, the experienced Richard Harrison will also strengthen the Company as Chief Operating Officer. The mining expert has already co-developed mines in the past, has a sound technical background, is familiar with planning and construction, the necessary permitting procedures, and leading teams in the resource sector. In the past, Harrison has worked with Agnico Eagle, Premier Gold, Xstrata, Cambior and Aur Resources. The personnel move underscores Troilus' plans to move quickly into production. A preliminary feasibility study is planned for 2020. Analysts at Cormack Securities called Troilus a "top pick" in May and issued a price target of CAD 4.50. Currently, the stock is trading around CAD 1.15. Given the rebounding gold price and increasing inflation fears, Troilus' stock could still rise in the market's favor. The project and management team appear promising.

    K+S: The principle of hope reigns here

    Investors also have high hopes for K+S: The fertilizer specialist has gained 78% over the past year. In the last three months, the share price has still risen by 25%. However, the share has weakened recently. The reason: K+S is still struggling financially and does not have the best balance sheet. In recent months, the stock has benefited from the turnaround fantasy. K+S succeeded in divesting problematic business segments. Added to this were rising raw material prices - which have always been a price driver for K+S. With an increasing valuation, however, investors are once again focusing more on the facts. These speak a clear language: free cash flow has fallen more and more in recent years and even signals a threatening situation. The K+S share is, therefore, a hot potato.

    Conclusion: Invest in the future without inherited burdens

    Similar to NEL, the K+S share also has its best times behind it. Both companies are suffering from increasing competition and cost pressure. Only an unforeseen event could give both shares another boost. The situation is different for Troilus Gold. Due to its status as a mine developer, the stock is speculative, but the Company does not suffer from legacy issues, and gold is in demand. Since there is also copper in the ground at Troilus, which benefits from the boom in electric mobility, investors can take a closer look at the value.


    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.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on news.financial. These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered here. Please also note our Terms of use.


    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



    Related comments:

    Commented by André Will-Laudien on January 18th, 2022 | 12:13 CET

    Lufthansa, TUI, Desert Gold - Explosive turnaround at the start of 2022!

    • Gold

    There was no sell-off in 2021 after all. Although the DAX started to crash in October and November, and the 200-day line was clearly undercut on both occasions at 14,850 points, the market nevertheless held these lines. The crash prophets all went quiet again, and by the end of the year, the index was back to just under 16,000 points. Who would have thought it - twice a whole 1,200 points reversal as if nothing had happened. High inflation figures and Omicron fears could not push the high liquidity out of the market so far. At the beginning of 2022, there are signs of a rebound for some beaten-up stocks.

    Read

    Commented by Armin Schulz on January 17th, 2022 | 13:22 CET

    Barrick Gold, Barsele Minerals, BP - Commodities are a sleeping giant

    • Gold

    For gold investors, 2021 was a very dull year. After breaking out to USD 2,075 in 2020, the commodity corrected and fluctuated between USD 1,600 and USD 1,900 in 2021. Medially, gold was displaced by bitcoin, and so there are many stocks in the gold sector, some of which are significantly undervalued. Oil has a similar fate. Due to climate protection, oil gets the image of a polluter, while a modern industrial society is still not possible without it. The major oil companies are no longer investing in the development of new deposits in order to improve their climate footprint. However, demand continues to rise and will remain high in the coming years. We take a look at three commodity companies from the two sectors.

    Read

    Commented by Carsten Mainitz on January 14th, 2022 | 12:31 CET

    Barrick Gold, Alerio Gold, First Majestic - Experts agree: 2022 will be the year of mining stocks

    • Gold

    2021 was a consistently strange year. Corona surprised with more new variants, Olaf Scholz became German Chancellor and the prices for gold and silver, despite ever-rising inflation, developed downwards towards the end year. While in the past many investors have relied on cryptocurrencies as a hedge against inflation, perhaps the recent price capers of the leading cryptocurrency, Bitcoin, could make investors rethink.

    Read