January 4th, 2024 | 07:30 CET
Price rockets 2024? Bayer, Siemens Energy and dynaCERT
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"[...] We are committed to stay as the number one Canadian and global leader in the Hydrogen-On-Demand diesel technology [...]" Jim Payne, CEO, dynaCERT Inc.
dynaCERT: Ready for the breakout in 2024
dynaCERT has held up relatively well in 2023 compared to other hydrogen stocks. While the shares of Nel, Plug Power, and others lost more than 50%, the Canadians lost around 8%. Of course, this is no reason for euphoria, but dynaCERT could achieve a breakthrough in commercialization this year. The Company has three hot irons in the fire for this: The patented HydraGEN™ system is designed for retrofitting conventional diesel engines to reduce consumption and emissions. The device only requires distilled water to produce hydrogen. It is particularly suitable for trucks and other large commercial vehicles. There were numerous orders, especially in the second half of 2023.
The cooperation with Cipher Neutron is also progressing. Orders for the AEM electrolyser for the production of green hydrogen were received in 2023. The use of reversible fuel cells should enable the AEM electrolyser to produce green hydrogen particularly cheaply and sustainably.
The third iron in the fire is income from the planned certificate trading. The VERRA certification of the dynaCERT product range took longer than expected but is now finally in the final phase. In November 2023, dynaCERT received a positive final assessment report from Earthood Services on the methodology for improving the efficiency of fleet vehicles and internal combustion engines. dynaCERT expects to be certified by VERRA in early 2024. The Canadians will then be able to sell the certificates together with their customers. This would enable significant and continuous revenues.
Bayer: Does success in California herald a turnaround?
While the DAX reached a new record high in 2023, Bayer shares lost over 20%. Can the stock take off again in 2024 after the horror year? At least the shareholders of the Leverkusen-based company hope so. After all, the Company started the new year with some positive news. Shortly before New Year's Eve, a legal success was achieved in the United States. A court in California ruled in favor of Bayer in the numerous lawsuits surrounding the crop protection product glyphosate. The jury found that glyphosate was not responsible for the plaintiff's illness. Nevertheless, the lawsuits relating to glyphosate and the chemical PCB are likely to continue to burden Bayer in 2024. The question is, what is already priced into the share price?
UBS sees no potential for Bayer shares. The analysts recently rated the shares as "Neutral". The price target is EUR 34 and thus at the current level. In the PCB case in particular, hardly any provisions have been made to date. Accordingly, a defeat in the appeal proceedings could weigh on Bayer.
Siemens Energy: 50% upside potential?
Siemens Energy has also had a disastrous year. Due to the problems caused by the difficulties of the subsidiary Siemens Gamesa, the parent company Siemens and the German state had to provide support. It remains to be seen whether there will be further problems, but there is at least some positive news from wind turbine manufacturer Siemens Gamesa. The expansion of a plant in Taiwan is being completed faster than planned. As a result, the section can already be put into operation in the second quarter of this year. The plant assembles wind turbines for offshore installations. It has a production capacity of 2 gigawatts per year and is the only one of its kind from Siemens Gamesa outside Europe.
Analysts are divided on how the Siemens Energy share will perform in the current year. Goldman Sachs is in the bull camp. The analysts recommend the German company's shares as a "Buy". The price target is EUR 18.60, which is around 50% above the current level. As the rating agency Standard & Poor's has removed the "Credit Watch Negative" rating, the risk of a capital increase out of necessity should decrease.
In contrast, JPMorgan does not see any upside potential for Siemens Energy. The analysts rate the share as "Neutral" and reduce the price target from EUR 13.80 to EUR 9.20. The risk of a necessary capital increase to strengthen the balance sheet remains.
In the hydrogen sector, the dynaCERT share could be a positive surprise in 2024 - provided that sentiment in the peer group does not deteriorate further, orders are processed as planned, and VERRA is finally certified. In contrast, there are numerous unanswered questions for Siemens Energy. Are there no further negative surprises at Gamesa? Will there be a capital increase after all? The same applies to Bayer. In addition to the legal disputes, the new Management Board must demonstrate growth prospects in the operating business.
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