Close menu




August 23rd, 2021 | 11:03 CEST

Rheinmetall, Defense Metals, NEL: What can work in this market

  • RareEarths
Photo credits: pixabay.com

The current events in Afghanistan show that countries will have to invest in their defense in the future in order to meet geostrategic requirements. Currently, the Bundeswehr is fighting tooth and nail against bureaucracy and time to save as many Germans or local forces and their families as possible from the Taliban. Modern equipment is just as necessary for this as efficient decision-making chains. In this article, we look at two defense-related companies and conclude with the current situation with NEL's hydrogen stock.

time to read: 3 minutes | Author: Nico Popp
ISIN: RHEINMETALL AG | DE0007030009 , DEFENSE METALS CORP. | CA2446331035 , NEL ASA NK-_20 | NO0010081235

Table of contents:


    Rheinmetall: Solid value with ESG weaknesses

    Rheinmetall's stock is benefiting from rising demand for defence equipment. The Defence sector accounts for more than 60% of Rheinmetall's sales. Another mainstay is the automotive sector. The Company imposed austerity measures on itself some time ago, which came to bear in the first quarter of the fiscal year. At the same time, things were going better for the auto industry, and defense budgets also had a stimulating effect. The current situation in Afghanistan, in particular, shows how strongly Europe is still dependent on the USA.

    Rheinmetall's stock is considered solid but does not have the best reputation. That is probably one of the reasons why the Company wants to restructure its divisions and focus more on areas such as sensors and electronic products in the future. It is said that this is where growth lies dormant. This price fantasy could soon give the share new impetus. On the downside, however, is the weak ESG profile. Armaments are anything but ethically sound. Investors should keep an eye on these risks.

    Defense Metals: The Chinese are putting a foot in the door

    Such ESG risks are not present at Defense Metals. The Company operates the "Wicheeda" rare earth concession area in the Canadian District of British Columbia. It is accessible via all-weather roads and connected to the energy grid. In recent months, the project has made significant progress, and the share price has achieved very dynamic gains in some cases. For some months now, the share price has also been at rest in connection with financing. At the same time, Defense Metals continues to make operational progress.

    It recently signed a letter of intent with Sinosteel MECC for joint processing tests and studies to build a pilot plant for the Wicheeda project. The Chinese Company Sinosteel has assisted and advanced 400 major metallurgical projects for the Chinese government. Rare earths are essential to many future technologies: besides electronics, they also include rechargeable batteries and other products. Rare earths are also needed in the defense sector. Although Sinosteel has already put out initial feelers in the direction of Defense Metals, it cannot be ruled out that the project will also attract the interest of North American investors. After all, the market for rare earths is already dominated by China and the metals are of great geostrategic importance.

    NEL: The numbers are clear

    Although the technology can be key to greater climate protection, the hydrogen industry has relatively little geostrategic significance. But the industry is languishing. The Norwegian Company NEL is considered a specialist in the production, storage and transport of hydrogen. But the former stock market star is only a shadow of its former self. Most recently, the Company published figures. In the second quarter, the Company posted a loss of NOK 149.1 million on operating sales of 163.7 million Norwegian kroner (NOK). These figures say it all. The share is currently struggling with the EUR 1.30 mark. If this level can be defended, the share could find a bottom here. However, the trend speaks a different language. The stock is not very promising. The competition for hydrogen is fierce, but its practical use lies in the distant future. There is currently no room on the market for visionary ideas. The share is presently uninteresting.


    While NEL is currently "out" and Rheinmetall has yet to establish its new direction while struggling with its image, Defense Metals could be worth considering for speculative investors. The stock has come back and things are progressing operationally. The project is still far from producing rare earths. However, there is no question that these metals are rare and in exceptionally high demand.


    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 in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on news.financial. These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered here. Please also note our Terms of use.


    Der Autor

    Nico Popp

    At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.

    About the author



    Related comments:

    Commented by Nico Popp on March 20th, 2023 | 08:00 CET

    BYD, Defense Metals, JinkoSolar - Energy transition reloaded! This is what matters now

    • Mining
    • RareEarths
    • Electromobility
    • Solar

    If you order a new photovoltaic system today, you cannot avoid products from China. Even German brands often work with Chinese partners and benefit from local technology at favorable prices. But the energy transition is facing a turning point: The gap between East and West is getting deeper and deeper. We look at what this means for companies in the sector and where opportunities could arise.

    Read

    Commented by André Will-Laudien on March 14th, 2023 | 11:33 CET

    Bank failure and new heaters! Nordex, Defense Metals, JinkoSolar - Greentech shares in the focus of investors

    • Mining
    • RareEarths
    • renewableenergies
    • GreenTech

    German Economics Minister Habeck wants to stick to his controversial plans to ban the installation of new oil and gas heating systems from 2024. In press releases, he describes the "heat turnaround" as mandatory. However, criticism of the plan is getting louder rather than quieter. What other countries do not even discuss is to be implemented here as quickly as possible due to a lack of fossil raw materials. The government in Berlin is worried about the climate targets set by law and still believes in the prosperity-securing transformation of the German economy and private households. The financing side of these projects is being forgotten because not everyone will be able to afford the purchases. FDP parliamentary group leader Dürr sent Habeck's plans back to the "assembly hall" for the time being on the talk show "Anne Will" because of various construction defects. The crux of the matter is energy availability, which is crucial for a green transformation. Which values now belong in the portfolio?

    Read

    Commented by André Will-Laudien on March 13th, 2023 | 13:12 CET

    Armaments and e-mobility! Rheinmetall, Almonty Industries, Mercedes-Benz - Rare raw materials in demand as never before!

    • Mining
    • Tungsten
    • RareEarths
    • Electromobility
    • climatechange

    The climate and energy transition are taking their toll. Long approval phases, too little exploration and a lack of investment capital have caused the supply of raw materials to decline over the past 10 years. These deficits are increasingly showing up as a problem for industry. In copper alone, there is a USD 100 billion investment deficit. In the EU, it is estimated that there is an investment backlog of EUR 300 billion to even come close to achieving the proclaimed climate targets. To reach climate targets, copper, nickel, lithium, zinc, special metals like tungsten, and rare earths are needed. Which values should you bet on now?

    Read