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May 9th, 2024 | 08:00 CEST

Stocks facing revaluation! Nel ASA, Bayer, Power Nickel with potential

  • Mining
  • Gold
  • Silver
  • Nickel
  • Pharma
  • renewableenergies
Photo credits: Nel ASA

Relief for Bayer. In the US, the Company has won a victory in the dispute over compensation for illnesses caused by the chemical PCB. Is it groundbreaking and the start of a revaluation of the share? A revaluation already seems to be underway at Power Nickel. Following sensational drilling results, the share price soared. Surprisingly, gold, silver and copper were also found. Against this backdrop, the share appears to be favorably valued. Does this also apply to Nel? After all, the share price has risen by around 20% in just a few weeks. Is there new hope for the hydrogen pioneer? Or are today's figures from industry peer Plug Power threatening a new sell-off?

time to read: 3 minutes | Author: Fabian Lorenz
ISIN: NEL ASA NK-_20 | NO0010081235 , BAYER AG NA O.N. | DE000BAY0017 , Power Nickel Inc. | CA7393011092

Table of contents:

    Power Nickel: More than 100% upside potential?

    Will surprisingly positive drilling results from the Nisk project in Canada lead to a revaluation of the Power Nickel share? It certainly looks like it. After all, Nisk is the most important project in Power Nickel's portfolio. CEO Terry Lynch: "We feel we have found a large, productive area that hosts different types of multi-element mineralization, each a small part of a much larger system. We look forward to intensifying our efforts in '24 and '25 to bring these targets to a production decision." Recent drilling has not only proven nickel, platinum and palladium, but also serious quantities of gold, silver and copper. Not surprisingly, Power Nickel has increased its interest in the Nisk project from 50% to 80%.

    The convincing drilling results also caught short sellers on the wrong foot, and Power Nickel shares doubled to over CAD 0.40 within a few weeks. Anyone expecting a decline afterwards was disappointed. After a brief consolidation, the share is now at CAD 0.45. This strength and the still manageable market capitalization of around CAD 70 million points to further price rises, especially in the current hype surrounding gold and copper. Investors can look forward to further drilling results.

    Bayer: Positive news at last

    Bayer has been slowed down by legal disputes for years. Best known are the class action lawsuits in the US concerning the weed killer glyphosate and the PCB chemicals. Bayer brought both problems into the Company with the takeover of Monsanto, whereby the production of PCBs had already been discontinued in 1977. Bayer has now won an important victory in the dispute over PCBs, which have been banned for decades. An appeals court in the US state of Washington has overturned a ruling from 2021. This involves damages totaling USD 185 million for three plaintiffs. Due to flaws in the judgment, the case must be reopened. This could result in further lawsuits by around 200 people. From Bayer's point of view, the products that caused the illness - such as lighting fixtures and sealants - were manufactured by other companies and should have been replaced long ago.

    Although Bayer's share price rose slightly after the announcement, it cannot be described as a liberating blow. Analysts also remain skeptical. Barclays, for example, has maintained its "equal weight" rating. The price target of EUR 28 has also stayed the same, and the analysts, therefore, see no upside potential. The victory in the appeal is surprising and, of course, positive, but the whole issue remains opaque, and the consequences for Bayer are difficult to quantify.

    Nel: Turnaround cancelled

    Has the turnaround at Nel been cancelled again? It certainly looks like it. Yesterday alone, the shares lost over 5%. The hydrogen specialist's partnership with Hy Stor Energy in the US had raised hopes that the downward trend could be reversed. For the project, Nel could supply alkaline electrolysers with a capacity of more than 1 gigawatt. However, this is not yet a concrete order, but only a reservation, so investors remain cautious. Especially as Plug Power will report figures today - this will also likely impact Nel.

    Analysts are also currently reluctant to take cover. Although Berenberg and Goldman Sachs recently recommended the Nel share as a buy, the price targets of NOK 8 and NOK 6.20 are anything but ambitious. After all, the 52-week high is over NOK 14.

    Power Nickel has real opportunities for a revaluation. With gold and copper, the Company has been able to acquire exciting resources. A turnaround for Bayer is not foreseeable, nor is the resolution of legal disputes. Likewise, investors may have to wait longer for a real turnaround with Nel. At the very least, it needs firm major orders.

    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

    Fabian Lorenz

    For more than twenty years, the Cologne native has been intensively involved with the stock market, both professionally and privately. He is particularly passionate about national and international small and micro caps.

    About the author

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