March 30th, 2022 | 12:50 CEST
Nordex, Altech Advanced Materials, Varta - Winners of the energy turnaround!
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"[...] Nickel, therefore, benefits twice: firstly from its growing importance within batteries and secondly from the generally growing demand for such storage. [...]" Terry Lynch, CEO, Power Nickel
Nordex - Outlook boosted
The war in Ukraine is making Germany painfully aware of how dependent it is on energy and raw material supplies from abroad. The faster expansion of renewable energies, which is now being sought, will also play into the hands of onshore wind turbine manufacturer Nordex in the medium term. However, sharply higher raw material prices and supply chain problems put heavy pressure on margins in the past fiscal year, which the stock acknowledged with a 40% drop in the share price over the past 12 months.
With the publication of the final figures and a positive outlook for the current fiscal year, as well as confirmation of the medium-term targets, which hold out the prospect of an EBITDA margin of 8%, the stock has recently bounced back. In the past year, the operating margin halved from an already low level to 1%. A 17% increase in sales to EUR 5.4 billion was nevertheless not enough to break even.
The Group loss widened by around EUR 100 million to EUR 230.2 million. The fact that the loss per share "only" fell from EUR 1.21 to EUR 1.68 was due to the capital increase carried out last year. That also improved the equity ratio (25.9% vs. 17.5%) and enabled a net cash position of EUR 423.7 million to be built up (previous year: net debt of EUR 40.9 million). The order intake and the increase in installed capacity were positive factors.
The outlook for the current fiscal year made stock market participants more optimistic, even though risks could spoil the Company's forecast. The northern Germans expect consolidated sales of EUR 5.4 to 6.0 billion in 2022. An EBITDA margin in the range of 1 to 3.5% should be achieved. However, this does not take into account "any costs for organizational restructuring and geopolitical events."
In addition, it is unclear whether cost increases can also be passed on to customers. As a result, another year of losses is highly probable. Analysts do not expect the Company to be back in the black until 2023. In the meantime, experts are optimistic about the stock and formulate average price targets of just under EUR 20. Nordex will publish its first-quarter results on May 12.
Altech Advanced Materials - Revolution
High-performance rechargeable batteries are needed for the rapid expansion of electromobility. Here, the Heidelberg-based company is using innovative processes. The nanocoating of battery materials with high-purity aluminum oxide (HPA) and silicon enrichment can prevent the deposition of lithium particles on the electrodes. The problem of current processes that lead to a loss of capacity after the first charge is thus addressed.
The Altech solution can increase the performance of lithium-ion batteries by around 10% and extend their service life by up to 30%. The Company is making further research efforts to increase the silicon content of the anode. If successful, this could boost performance by a staggering 50 to 100% and leave envious competitors in its wake.
For the production of the anode material, the first step was to acquire a site in Schwarze Pumpe, south of Cottbus. Planning and approval procedures for the pilot plant are currently underway. At the highest stage of expansion, the plant is expected to employ 150 people and produce around 10,000 tons per year.
With its choice of location, Altech is seeking proximity to future customers. Several battery producers are located in the area, including Tesla's Gigafactory. The Company's ambitious goal is to become the world market leader in the nanocoating of battery materials. With a current market capitalization of just under EUR 6 million, the stock market has not yet priced this in.
Varta - Countdown
The South German share has lost around 30% in the last 12 months. New momentum could come with the upcoming publication of the figures for the past fiscal year and an outlook. For 2021, the group had forecast sales of EUR 900 million and an adjusted EBITDA margin of 30%.
Because of the not favorable valuation with a 2022 P/E ratio of 26 with moderate growth data, a concretization of the growth plans concerning the newly developed V4Drive cells should do the share certificates good. Last year, Varta announced its entry into the e-mobility business with the production of high-performance batteries. Analysts currently estimate the share's upside potential at about 25%.
Renewable energies and e-mobility are megatrends that investors can hardly ignore. With the confirmation of the medium-term forecast, investors can again slowly set their sights on Nordex. Pointing the way for Varta is the concretization of growth plans. With its innovative solutions, Altech has the potential to revolutionize battery technology.
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 hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.
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