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January 31st, 2024 | 06:30 CET

Rheinmetall, Globex Mining and Hochtief with trend-setting impulses

  • Mining
  • Commodities
  • armaments
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The last week of January promises further excitement on the global stock markets. This week, none other than the Magnificent Seven will report on the past financial year and provide further forecasts for the future. In terms of figures, things are still relatively dull in Germany. Nevertheless, news that significantly impacts the respective companies' share prices is reported almost daily. In addition to the pharmaceutical giant Bayer, another company had to take a hard knock in court.

time to read: 3 minutes | Author: Stefan Feulner

Table of contents:

    Rheinmetall still on fire

    Since the start of the Ukraine war in February 2022, when Russia launched a large-scale invasion of Ukraine, the shares of the defense company have shown no signs of slowing down. The Düsseldorf-based company's share price has risen by an astounding 270%. With ongoing rearmament and the threat of escalating tensions, an end to this bull run is hardly in sight. After a brief pause last week, the share price is once again poised to surpass the previous all-time high of EUR 337.90 from early January.

    The continued positive trend is being fueled by a steady news flow about new arms deliveries from various countries. For example, the Company led by Armin Papperger received another significant arms order for the delivery of Fuchs 2 armoured vehicles from an unnamed international partner. The value of this total order is said to be in the high three-digit million euro range.

    The Fuchs 2, a further development of the Fuchs 1, is used in different variants by armed forces worldwide. The Fuchs has been in service with the Bundeswehr for almost 50 years. To date, around 1,800 vehicles of this type have been produced. The Bundeswehr has around 940 Fuchs vehicles, including 272 in the modernized 1A8 version. This version, the Fuchs 1A8, offers improved protection against mines and booby traps as well as increased ballistic protection. Significant improvements include structural changes, new seats and seat suspensions, reinforced wheel arches, doors and windshield brackets, as well as additional stowage boxes and exterior reinforcements.

    Globex Mining - Like clockwork

    Similar to the integrated technology group from Germany, the resource incubator Globex Mining also boasts a consistently active news flow. No wonder, as the Company, led by mining veteran Jack Stoch, holds an impressive portfolio of no fewer than 230 projects. These projects range from gold, silver, platinum and palladium deposits and base metals to industrial metals such as lithium and cobalt, covering nearly all essential commodities.

    The Canadian company has been listed on the Toronto Stock Exchange since 1995. The shares are also traded in Germany and on the OTCQX International Exchange in the United States.

    Unlike most junior exploration companies, Globex owns its properties, many of which are available as options. As a result, the exploration company generates regular cash flow. Over 100 properties have been passed on to licensees, providing Globex Mining with ongoing payments in the form of cash, shares or options.

    The most recent example of the thriving business model was the announcement that licensee Brunswick Exploration commenced a Phase II drilling campaign on the Mirage project in the Eeyou Istchee James Bay region of Quebec. The winter drill program targets extensions of known pegmatite veins and new prospective outcrops that have not yet been drill-tested. The planned drill holes are spread over the known strike length of 2.8 km to test the entire spodumene-bearing pegmatite dike swarm. Previous drilling has returned high-grade lithium oxide grades over wide widths.

    Hochtief falls deep

    The last Monday in January began tranquilly for the Essen-based construction company Hochtief. However, around 2 pm, when the trading floors filled up again after the well-earned lunch break, the structure collapsed. The share lost around 12% of its value within an hour and sank below the striking support level of EUR 100.

    The cause of the sell-off was a court ruling from one of Germany's favourite vacation destinations. The Spanish Supreme Court, specifically its third chamber, rejected Abertis' claims by a majority. Abertis, a concessionaire of the AP-7 highway, which was taken over by Hochtief five years ago, had demanded compensation of over EUR 4 billion from the Spanish state.

    However, according to a report in the Spanish newspaper "El Economista", a compensation payment from Spain to the infrastructure company Abertis is expected to be significantly lower than the Company's claim. With Monday's slide, the Hochtief share price is approaching the average price target of the analysts who analyze the share, according to Reuters Refinitiv. They see a fair value of EUR 97.00. Only one financial expert considers the share a "Buy", while six others rate it a "Hold".

    Business continues to boom for the defense company Rheinmetall. At Globex, too, the positive news continues to flow steadily. Hochtief, on the other hand, has suffered a significant setback in court.

    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.

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    Der Autor

    Stefan Feulner

    The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
    He is passionate about analyzing a wide variety of business models and investigating new trends.

    About the author

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