August 26th, 2021 | 13:12 CEST
Pure Extraction, Nikola, SFC Energy - Is Elon Musk wrong with his hydrogen forecast?
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"[...] Why should a modular electrolyzer cost more than a motorcycle? [...]" Sebastian-Justus Schmidt, CEO and Founder, Enapter AG
Pure Extraction - Green light
The Canadian Company First Hydrogen, which is currently still trading under its old name Pure Extraction on the stock exchange, is preparing to revolutionize the market for emission-free delivery vehicles. Using a "best of" approach, the Company, together with its experienced partners Ballard Power and AVL Powertrain, aims to produce a prototype zero-emission delivery vehicle based on hydrogen fuel cell technology within just twelve months in order to overcome the disadvantages of battery technology, such as short-range or long charging cycles. The contracts signed with the partners for this purpose back in July have now finally been signed off.
Ballard Power will develop and supply the appropriate fuel cell for the joint project; AVL Powertrain has been contracted to design and manufacture the prototype based on a proven chassis. To finance the development, the Company, currently valued at approximately CAD 88 million, recently completed a private placement of 2.4 million shares at a price of CAD 1.25, raising approximately CAD 3 million.
The newly issued shares are linked to a warrant with a term of 2 years and a subscription price of CAD 2.00. The shares are currently trading at around CAD 1.90. The Company is still at an early stage of development; the next step is completing the prototype. In perspective, we are convinced that a relevant market for such a product will emerge.
Nikola - Is the turnaround finally in sight?
The suffering of Nikola shareholders continues. The paper of the fuel cell commercial vehicle pioneer recently reached a new low for the year at USD 9.02. But could that be it now? Was that the dregs? After all, the share has since recovered to over USD 10. For this trend to continue, Nikola must deliver more positive news in the future. Investors are still too aware of the fraud allegations against the former CEO, the collapse of the GM deal and the cancellation of various orders in the wake of the Corona pandemic.
And so the Company, which is currently still valued at around USD 4 billion on the stock exchange, is taking small steps to regain the lost trust of investors. In the second quarter, the Company announced a cooperation with the American Tank & Rast operator TravelCenters of America to build two hydrogen filling stations in California.
In the current Q3, the Company now announced the receipt of USD 2 million in funding from the US Department of Energy to develop autonomous refueling technology for future hydrogen stations. So things are moving forward, albeit in small steps. Hard-core investors can take a small position in the portfolio at the current price. For all others, it is: wait and see! In any case, there are currently no reasons in sight for an imminent price rally.
SFC Energy - Strong half-year figures
First of all: No, SFC Energy has nothing directly to do with electric mobility. The Company from Brunnthal in Upper Bavaria develops and manufactures self-sufficient long-term power supplies based on fuel cells, usually operated with methanol. The largest 2,500-watt system in the 50 kW class is also operated with pure hydrogen. These power supplies are used, for example, at weather measuring stations in offshore wind farms or in other locations that are difficult to access. In addition, the Company also provides the necessary power electronics, measurement technology, etc., which are required for highly demanding measurements or in critical industrial production.
Now on Tuesday, the Company presented its half-year figures, which excited investors. Sales rose by 12.3%, and gross profit climbed by as much as 27.5%. Due to increased provisions for compensation programs, EBITDA remained negative but improved year-on-year to EUR -1.9 million from EUR -2.1 million. The Management Board was also able to confirm the forecast for the current fiscal year: sales are expected to increase by between 15% and 30% compared to the previous year. The figures were reason enough for the analysts at First Berlin to confirm their target price for the share of EUR 44.00. That corresponds to a price potential of just under 60%.
Of the three shares presented, SFC Energy is certainly the most established Company. The newsflow is positive, and the share is developing largely decoupled from the rest of the hydrogen market. Anyone who wants to participate in the opportunities and inevitably also the risks of a still young company in the sector should take a closer look at First Hydrogen. If the emission-free delivery vehicle project is successful at an affordable price, a huge market will open up for the Company, and a takeover could be considered. On the other hand, Nikola's shares should be viewed from a distance for the time being. As long as the newsflow is not more steady and positive, a strong increase in the share price is not to be expected for the time being.
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