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December 1st, 2020 | 09:32 CET

SAF-Holland, ElringKlinger, Almonty: cyclical for the year-end rallye

  • Investments
Photo credits: Almonty Industries

Prices are picking up once again: Vaccination hopes and the recovery of the global economy are boosting cyclical stocks, in particular, such as the automotive industry. However, base metals are also considered a good bet in times of economic upswing. But one after the other. The shares of SAF-Holland, the commercial vehicle and camping equipment supplier, rose by more than 40% on a one-year horizon. In the past few days, it still grew by more than 7% despite a minor consolidation. While the stock was still considered a beneficiary of the trend toward camping trips after the initial lockdown, the hard facts are now providing price fantasy. When the economy is booming, commercial vehicles will be needed again, according to the market.

time to read: 2 minutes | Author: Nico Popp
ISIN: CA0203981034 , DE000SAFH001 , DE0007856023

Table of contents:


    SAF-Holland and the advance praise

    SAF-Holland presented weak figures for the first half of the year, losing ground in all regions and across all business units, particularly in the wake of the pandemic. However, necessity is the mother of invention: The Company cut costs in sales and administration and made diligent savings. Nevertheless, the outlook remains subdued.

    SAF-Holland's shares are one of those cyclical stocks that are not yet really on track operationally. The price gains on the market are mostly early praise. The value may be interesting for gamblers, but those who are looking for substance are better to wait a little longer.

    ElringKlinger: 75% in one month

    The ElringKlinger share is likely to be even more in the focus of speculative investors. The specialist for cylinder-head gaskets and other parts relating to engines, transmissions and exhaust systems, is the epitome of the German supplier: its products are of a high standard and rightly in demand worldwide. However, classic engines are also a thing of the past. For this reason, too, ElringKlinger's shares were worth just EUR 3.80 in mid-March. But these times are over: Today, the share is quoted at around EUR 13.

    Last month alone, the share price rose by a breathtaking 75%. But how long has this trend been going well? With share price rallies of this kind, the principle quickly applies: "The last one bites the dust." Hardboiled gamblers should secure positions and continue to observe the situation on the market. If the mood remains rosy, even automotive suppliers can be good for a few percent.

    Almonty represents tungsten outside China

    One share that is also related to the automotive industry in a broader sense is that of the tungsten producer Almonty. The Company operates two tungsten mines in Spain and Portugal which is a ray of hope given the market dominance of China. China supplies around 80% of the world's tungsten production. The industrial metal is used, for example, in filaments in car windows, where it ensures that these can be heated and freed from ice. Tungsten also plays a role wherever corrosion protection is essential, for example, in chemical plants. Furthermore, tungsten in alloys ensures that these become heat-resistant. Tungsten is therefore also used in engines.

    In addition to the two existing mines in Southern Europe, Almonty has already begun building its mine in South Korea. Once complete, 30% of non-Chinese tungsten production will be extracted from here. Production at the Sangdong mine is scheduled to start in 2022. Almonty is collaborating with Deutsche Rohstoff AG and intends to advance the project rapidly. The preliminary work is currently ensuring that Almonty is in the red, but this is likely to be temporary. The market is presently interpreting the situation similarly: the share has bottomed out in the range of EUR 0.40.

    Base metals attractive looking to 2021

    Given the dizzying heights to which cyclical stocks such as automotive suppliers have risen, Almonty's stock currently seems anything but overbought. Although Canadian mining stocks are often under pressure in December in the wake of tax-driven sales, base metals stocks could offer opportunities in a friendly market environment looking ahead to 2021.


    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.

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    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



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