December 9th, 2021 | 05:09 CET
SAP, Kleos Space, Palantir - Big things happening here
Table of contents:
Kleos Space - Massive expansion next year
The market for satellite-based earth observation is enormous, with an estimated value of EUR 4.1 billion, and is also expected to continue growing by 6% annually. The few players in the market are mainly in the US and, like Rocket Lab at USD 3.5 billion and Spire at USD 1.2 billion, already have valuations in the billions. Luxembourg-based Kleos Space, with a market capitalization of a manageable EUR 72.43 million, still lags far behind. The growth prospects are gigantic, and the Company founded in Australia around CEO Andrew Bowyer is planning big things.
Kleos Space acts as a data-as-a-service provider by having satellites - a satellite cluster consists of four units each - orbit the earth and scan it for radio frequency signals for geolocation. The focus right now is on the maritime domain. Thus, data from the South China Sea, East and West Africa, and the north coast of Australia are recorded and analyzed. The model is highly scalable, as the data can be recorded and processed only once but sold several times. Customers to be considered include law enforcement, civil aviation and insurance companies, in addition to the maritime industry. Customers will be billed via a subscription model, generating recurring revenue for the Company.
With the successful closing of a USD 9.4 million private placement, the focus for the next year is clearly on the expansion and enhancement of the satellite network. So far, 2 clusters have been launched into space. The third is to be brought up in conjunction with the next SpaceX transporter rideshare flight. The medium-term goal of the ambitious management is 20 satellite clusters. The valuation should then naturally rise into other regions.
First Berlin analysts see a dramatic acceleration in revenues, resulting in Kleos being profitable and generating positive free cash flow in 2022, three years earlier than previously expected. Average EBITDA margins of over 70% and exceptionally high cash flow justify the upgrade of its DCF valuation to AUD 5.00, equivalent to around EUR 3.16. The current share price in Frankfurt is EUR 0.44.
Palantir - Sensible cooperation
It is a controversial and polarizing company - we are talking about Palantir Technologies, the undisputed market leader in the field of Big Data analytics. Due to the collection of sensitive data and the connection to the US government, the Company from Denver, Colorado, is critically eyed. However, the amount of data and data quality is gradually increasing, so Palantir offers its public and private sector customers a solution that will be invaluable in the years to come. After a high of USD 45 and a stronger correction, the stock could again represent an exciting buying opportunity in the long term at the current level, around USD 20.
Through a partnership with the German DAX company Merck KGaA, an innovative solution could be found that could at least counteract the chip shortage problem. This cooperation aims to provide the semiconductor industry with a secure, collaborative data analysis platform called Athinia. Using artificial intelligence (AI) and Big Data, the Athinia platform is expected to help solve key challenges such as chip shortages, improve quality and supply chain visibility, and accelerate time-to-market.
"The semiconductor industry is facing unprecedented upheaval. Companies need a secure and collaborative data platform that gives them the visibility and data intelligence they need to address challenges such as chip shortages and supply chain issues," said Kai Beckmann, member of the Merck Executive Board and CEO of Electronics.
SAP - Confidence in its own Company
After reaching highs of just under EUR 130, the share of software giant SAP also consolidated in exemplary fashion and again touched the support area at around EUR 114. Successful defense and a sustained break above the EUR 121 mark should help the stock attack the high for the year once again.
Hasso Plattner, a current member of the SAP Supervisory Board, has shown confidence in the Company he co-founded. Last week, he bought more than 137,000 SAP shares through his investment company and paid more than EUR 15 million for them. Six weeks earlier, he had already made an appearance as a buyer. At that time, he invested EUR 39.6 million in 324,219 shares.
Space travel is currently experiencing a boom. In addition to vacations in space, however, the latest technologies are also being put to good use, as exemplified by the innovative and promising Company Kleos Space, in fighting crime. Besides SAP, the data analysis specialist Palantir is also promising at the current level.
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