April 11th, 2024 | 07:30 CEST
Panic at AIXTRON and NEL! Is Kraken Energy an AI beneficiary?
AIXTRON shares lost more than 5% yesterday. In addition to the price slide on the NASDAQ, a negative analyst comment added to the negative sentiment. Both the rating and target price of the AIXTRON share were significantly reduced. The same applies to Nel. The hydrogen specialist's recovery attempt was mercilessly stifled, and the share lost over 15%. The lack of incoming orders, in particular, is making analysts nervous. In contrast, Kraken Energy could soon be seen as an AI beneficiary. After all, Elon Musk is not the only one warning of an energy crisis and calling for the expansion of nuclear energy. Voices are getting louder that the computing power required for artificial intelligence will cause energy consumption to explode. In order to prevent a blackout, many countries are turning to nuclear power.
time to read: 3 minutes
|
Author:
Fabian Lorenz
ISIN:
AIXTRON SE NA O.N. | DE000A0WMPJ6 , NEL ASA NK-_20 | NO0010081235 , KRAKEN ENERGY CORP | CA50075X1024
Table of contents:
"[...] In Canada, there is $1.75 of debt for every dollar of disposable income - and that was true even before the pandemic. [...]" Karim Nanji, CEO, Marble Financial
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.
Tag cloud
Shares cloud
Kraken Energy: Will uranium become an "AI beneficiary"?
More and more companies are investing in artificial intelligence (AI). This brings with it unforeseen challenges. Because the data centers required for the AI boom are gigantic and where the electricity needed for them is to come from is hardly clear. Elon Musk expects that electromobility and the AI boom will cause energy consumption in the US to triple by 2045. Experts from the Boston Consulting Group expect energy consumption by data centers in the United States alone to explode from 126 terawatt hours in 2022 to 390 terawatt hours in 2030.
While Germany is known to be converting its energy supply to renewable sources, nuclear power will play an important role in the energy mix of many other countries in the future. China, for example, has announced that 42 new nuclear reactors are to go into operation over the next 15 years. Worldwide, 8 nuclear reactors are currently under construction. This makes it clear that the demand for uranium will remain high in the coming years. The uranium price has consolidated in recent weeks, and with it, numerous companies in the sector. One of these is Kraken Energy. This offers a buying opportunity.
The Company focuses on historical properties in the US. As a result, deposits have already been proven on the sites in the past. In addition, there is no country risk, as is the case with explorers in Africa, for example. Specifically, Kraken Energy owns four high-grade uranium projects in the US states of Nevada and Utah. Three projects have already produced uranium in the past, and with new technology and higher prices, it is now worth revitalizing them. After receiving the green light for its drill program at the Hearts Point property in Utah at the turn of the year,* Kraken CEO Matthew Schwab commented: "We have great confidence in the property after drilling only two holes over a 5 km length and intersecting elevated radioactivity in both. We look forward to continuing our work in Utah as we move forward with advanced exploration of our portfolio of exciting properties*."
Further positive news should soon give the share a boost.
AIXTRON: Price target shaved
The AIXTRON share is currently looking for a bottom. After the surprisingly weak forecast for the current year, every attempt at recovery is being sold off. This was also the case yesterday when the share temporarily lost more than 5% and slipped well below EUR 22. The reason was a negative analyst comment. The experts at Exane BNP Paribas believe that shipments of Silicon Carbide (SiC) production systems from AIXTRON peaked last year. Even after the transition year 2024, they expect the Company will be unable to maintain its market share. One of the reasons for this is that chip manufacturers are increasingly switching to wafers with a diameter of 200 mm rather than 150 mm. The analysts have, therefore, more than halved their price target for the AIXTRON share to EUR 21.91 and downgraded the stock from "Outperform" to "Underperform". AIXTRON itself had reacted to the rumors of market share losses a few weeks ago and emphasized that demand was stable. Jefferies then confirmed its "Buy" recommendation with a price target of EUR 50.
Nel: Where are the orders?
Yesterday, a negative analyst comment also caused a sell-off in the Nel share. As a result, the hydrogen specialist's share lost more than 15% at one point and traded below EUR 0.50 again. This also marked the brutal end to a countermovement.
Pareto Securities has downgraded the Nel share from "Hold" to "Sell". The price target was shaved from NOK 5 to NOK 4. Although the analysts expect Nel to report record figures in the first quarter of 2024, there will be massive challenges after that: New orders are needed, the loss remains high, and therefore, more capital is needed. Nel needs to acquire orders totaling around NOK 7 billion. However, there is currently no sign of this. Thus, the loss in the operating business will be significant for the time being.
The fact that uranium will be in demand in the coming years is nothing new. However, if uranium now also becomes an "AI beneficiary", the consolidation in the price and the shares of the sector should soon be over. Kraken Energy is an interesting explorer in this regard. AIXTRON and Nel have simply run out of steam at the moment, although a rebound is possible at any time. In the case of the Norwegians, in addition to operational issues, there is also negative sentiment within the industry.
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.
In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.
For this reason, there is a concrete conflict of interest.
The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.
Risk notice
Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on news.financial. These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.
The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.
The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.
