New to the Index, Then Hit Hard: Hochtief, Almonty Industries, AT&S, and Marvell Technology Put to the Test

Hochtief: When a Mark of Distinction Becomes a Setback

June 22, 2026, was a historic day for the Essen-based construction group Hochtief. For the first time in the company's more than 150-year history, the stock was promoted to the DAX—under a fast-track procedure (Fast Entry), Hochtief replaced Porsche Automobil Holding in Germany's leading index. What sounded like a triumph was met by the stock market with a sharp decline. Since then, the share price has fallen from EUR 528.50 to its current level of EUR 441.80—a drop of 16%. The reason lies less in the company's business performance than in the mechanics of the index inclusion. Weeks before the effective date, the inclusion was already foreseeable, so index-tracking funds had long since built up their positions. On the day of inclusion, the final anticipated inflow of passive funds occurred, after which demand dried up. There is an old stock market adage for this: "buy the rumour, sell the news"—the good news is priced in before it actually happens.

Despite solid half-year results and an upward revision to the earnings forecast, some analysts viewed the valuation as excessive. Despite the recent setback, the stock is trading at more than double its price from a year ago; the price-to-earnings (P/E) ratio of about 23, based on estimates for 2027, is ambitious for a company in a cyclical industry. The US investment bank Jefferies therefore rated the stock only "Hold" following the earnings release, and Bernstein Research and Barclays Capital have also recently been unable to bring themselves to issue "Buy" recommendations. From the experts' perspective, the growth potential driven by the construction of AI data centers, barracks, and other military facilities appears to be largely priced in, as do the activities of the group's own mining service providers Thiess and Sedgman, which provide mining infrastructure for the extraction of critical raw materials such as lithium, nickel, and rare earth elements. Still, the analysts' average price target of EUR 499.20 suggests there is still about 13% upside potential from current levels.

Almonty Industries: Strong News, Weak Share Price

The shares of Almonty Industries were hit even harder. Just one week later, on June 29, the company was added to the broad-based US market index Russell 3000 as well as the large-cap barometer Russell 1000. Since then, the share price has fallen from USD 16.14 to its current level of approximately USD 11.32; since hitting a high of over USD 23.00 in April, the price has more than halved. This is particularly noteworthy because the operational news during this period was exceptionally positive. In early July, the company announced the start of operations at the Sangdong Mine in South Korea, which is on its way to becoming the Western world's most important tungsten project. Shortly thereafter, the company expanded its long-term supply contract with Global Tungsten & Powders, a member of the Austrian Plansee Group. The term was extended from 15 to 21 years, the contracted volume was increased by 40% to 4.41 million metric ton units (MTUs), and the price per unit was improved by approximately 6.3%.

Due to its extreme heat resistance—its melting point is 3,422 degrees Celsius—tungsten is of crucial importance for military applications as well as the civilian aerospace industry, whether in armour-piercing ammunition or rocket engines. Governments worldwide classify this heavy metal as a key raw material. Since about 80% of global production comes from China, Almonty represents the West's greatest hope for supplies from secure sources. In addition to the project in South Korea, the group operates in Portugal and is developing deposits in Spain and the US state of Montana. The scarcity of the material is also reflected in its price. A metric ton unit (10 kg) of tungsten trioxide fetches around USD 3,000—a historically high level. Although the price in Shanghai has fallen sharply since May (possibly even due to the new supply from Sangdong), this has had no impact whatsoever on the Western markets, which are crucial for Almonty.

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Consequently, the sharp drop in the share price cannot be attributed to the commodity price, but rather to an announcement by the major shareholder Deutsche Rohstoff AG. On July 22, the company announced that it had sold 5 million Almonty shares at an average price of just under USD 16, realizing a profit contribution of approximately EUR 65 million (before taxes). As a result, the company was able to raise its profit forecast for 2026. A major investor selling a significant amount of shares into the market explains part of the downward pressure on the share price; the rest is due to index mechanics. Following the partial sale, Deutsche Rohstoff AG still holds approximately 5.5 million Almonty shares as well as receivables from convertible bonds and loans—a potential source of uncertainty that apparently continues to weigh on the share price even after the recent large-scale sale.

The stock may have also become somewhat overvalued amid rising tungsten prices and its upcoming inclusion in the Russell indices. In terms of valuation, unlike Hochtief, it has now reached bargain levels. On average, analysts expect the company to post earnings of USD 1.47 per share next year, resulting in an extremely low P/E ratio of 7.7—a very moderate level for a key stock in the Western world. The upside potential is correspondingly high. The average price target of USD 26.05 set by research firms signals the potential for the stock to double in value. The current price drop could therefore prove to be a stroke of luck for new investors. The next quarterly report is expected on August 17. If expectations are met even to a small degree, the conditions for a turnaround will be in place.

AT&S: From an Order Boom to Index Disillusionment

On June 22, the day Hochtief was added to the DAX, the Austrian printed circuit board and IC substrate manufacturer AT&S was included in the STOXX Europe 600. The pattern resembles that of Almonty: from EUR 243.50 on the day of its inclusion in the broad-based European stock index, the price has fallen to its current level of EUR 140.00. Fueled by the AI boom and its major customer AMD, the stock had risen at a virtually parabolic rate in the run-up—the closest parallel to Almonty, not because of the industry, but because of the overheated starting point. In precisely such a scenario, inclusion in the index does not act as a price driver but rather as a trigger for profit-taking. Added to this is the fact that the semiconductor euphoria has turned on its head during the same period. Just a few weeks ago, brokerage firms were literally falling over themselves with "Buy" recommendations: The most recent price targets range from EUR 245.00 from Cantor Fitzgerald, EUR 310.00 from Deutsche Bank, and EUR 600.00 from Aletheia Capital. If older and somewhat more skeptical studies are taken into account, the average target price stands at EUR 210.30, which corresponds to 50% upside potential. Given the reasonable 2027 P/E ratio of 22.5, this is not out of the question.

The AI and cloud boom is driving demand for the company's specialty products. Above all, IC substrates (Integrated Circuit Substrates)—the highly complex interface layer between the tiny microchip and the larger printed circuit board, a core competency of the Austrian company—are ensuring full order books. They are responsible for signal distribution, power supply, protection, and cooling. Management has long since responded to the high demand. The cleanroom space at the main plant in Leoben is being expanded from 760 to 2,300 m², and capacity expansions are also underway in Chongqing, China, based on long-term customer agreements. The next quarterly report is due on August 4. This will soon determine whether yesterday's 20% jump in the share price was just a flash in the pan or whether the correction is already behind us.

Marvell Technology: Soaring Before the Fall

A prominent fourth case shows that this pattern is the rule rather than the exception. The semiconductor company Marvell Technology, which was added to the US benchmark index S&P 500 on June 22 and had been driven up sharply in the run-up to the AI boom, also came under significant pressure following its rise. The same dynamic is thus repeating itself across industries and indices. In this case, the stock fell from USD 307.86 to its current price of USD 180.55. Despite the price slump, the US chip designer's stock is still valued on the high side, with a 2027 P/E ratio well over 40. Whether this valuation is justified will become clear on August 20, when the second-quarter earnings figures are released.

Inclusion in a major index has long ceased to be a reliable driver of share price. On the contrary—the day of inclusion often marks the moment when the demand built up in the run-up to the announcement is exhausted. "Buy the rumour, sell the news" captures the essence: what was foreseeable is already priced in. For long-term investors, this raises the question of whether the pullbacks following the "inclusion hangover" are more like buying opportunities or warning signs. There is no one-size-fits-all answer. Where the price weakness stems primarily from exhausted index demand, it may be temporary; where an excess supply or an overstretched valuation is behind it, patience is called for. If the analysts are correct, Almonty has already entered the buy zone. For the other stocks, however, following yesterday's rebound, the risk of relatively high valuations remains, which is why investors should wait to see how the market reacts to the next set of earnings figures.