February 15th, 2023 | 11:00 CET
Super Bowl spoils Tesla's bullish mood: Plug Power, First Hydrogen, Nel, ThyssenKrupp - Hydrogen is taking off!
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"[...] We are committed to stay as the number one Canadian and global leader in the Hydrogen-On-Demand diesel technology [...]" Jim Payne, CEO, dynaCERT Inc.
Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
ThyssenKrupp - Share price slumps after the numbers
We start with the good news first. Despite a weak performance in the last quarter, thyssenkrupp AG is sticking to its stock market plans for its H2 subsidiary nucera. This will ensure that the Group adheres to its line in expanding its H2 strategy. According to CFO Klaus Keysberg, the only thing that matters for implementing nucera's planned IPO is the right stock market environment, and the listing process is already fully prepared. This is important for thyssenkrupp and Germany as a business location because considerable investments in technology and research are needed here, which also have to be financed via the capital markets.
Falling steel prices in the trading business caused a noticeable drop in earnings for the industrial Group in the first quarter. In the three months to the end of December, adjusted EBIT fell by a third to EUR 254 million. The sale of non-core businesses also had a negative impact. With sales held at around EUR 9 billion, the Group earned EUR 75 million below the line, 29% less than in the prior-year period. However, the traditional steel business improved its earnings despite significantly higher raw material and energy costs; longer-term contracts had a positive effect here. By contrast, the otherwise sharp rise in costs resulted in significantly weaker earnings in the industrial components business. Order intake also decreased by 12% to just under EUR 9.2 billion.
thyssenkrupp reaffirmed its forecast for fiscal 2022/23 and continues to expect a decline in operating earnings and "at least" break-even net income. The share price initially dipped by 6%. From a chart perspective, the setback to EUR 6.30 offers a good entry opportunity.
First Hydrogen - The next generation of emission-free vehicles
The combustion engine is on the brink of extinction in Europe. The EU Commission has set corresponding phase-out targets and yesterday decided on the year 2035. From then on, models with conventional drive engines can no longer be registered in the EU. We are taking climate protection seriously! Emission-free mobility solutions have long been an essential part of climate plans, as this is the only way to achieve CO2 reduction targets. Among other things, the EU has decided for the coming years to reduce emissions from new cars by 55% by 2030 and from new vans by 50% compared to 2021.
Green hydrogen has the potential to help overcome the coming obstacles, provided the technologies can be implemented on an industrial scale promptly. One company that has long had the shift to green hydrogen on its radar is zero-emissions logistics solutions provider First Hydrogen. The Company has clearly positioned itself with its "Hydrogen-as-a-Service" model. It intends to cover the entire value chain in the future with the construction of zero-emission vehicles and the production and distribution of green hydrogen.
Hydrogen has the potential to change logistics. It is ideally suited for long-distance transportation, and its technical values beat lithium-ion batteries hands down. Swedish automaker Volvo recently unveiled a hydrogen-powered test truck. It has achieved a range of 965 km and can be refueled in 15 minutes. In addition, the concept truck can carry a load of 65 tons.
Meanwhile, First Hydrogen presents new images of the next generation of vehicles. In terms of technical implementation, the Canadians are working with EDAG Group's global mobility engineers to develop the second-generation light commercial vehicle (LCV). The Company's two first-generation LCVs were launched in 2022 as a technical proof of concept and have attracted interest from major fleet operators. Members of the UK's Aggregated Hydrogen Freight Consortium (AHFC), including national supermarket chains, breakdown services, utilities and parcel delivery companies, are conducting initial operational trials this year.
According to expert estimates, the global market for light commercial vehicles is expected to reach USD 752 billion by 2030. The politically widespread zero-emission targets, government incentive schemes and infrastructure investments further boost this market. Because of its extraordinary innovation, First Hydrogen, with a market cap of just EUR 167 million, is a top pick for 2023, as the "real hydrogen wave" is likely just getting started now. With the First Hydrogen share (FHYD), investors are thus ideally positioned to profit from the upcoming game changer in mobility. At today's 6th International Investment Forum, we will have the CEO of the energy division Robert Campbell on hand to answer questions live at 1:30 pm. The online event is free to attend, with registration still open.
Nel ASA versus Plug Power - Which share is more convincing fundamentally?
The NEL share has already gained 30% since the beginning of the year due to bulging order books; currently, the price is consolidating again somewhat. Ultimately, Nel ASA has nevertheless fallen 18% in 2022; the highs from 2020 are admittedly still more than 250% away. There is plenty of positive news at present. For example, Nel recently signed an agreement with German energy company HH2E for a potential 120 MW capacity in Germany. "These projects are important for the energy transition in Germany and Europe, and we are pleased to support HH2E in their efforts towards a greener society," says Håkon Volldal, CEO of Nel. HH2E's two 60 MW plants will be among the largest green hydrogen production plants announced to date in Europe, which will be used for industrial applications, transportation and heat supply. Overall, HH2E is targeting 4 GW of electrolyzer capacity in Germany by 2030. US major Morgan Stanley raised its 12-month price target for Nel shares to NOK 22 from NOK 13 and its rating to Overweight from Equal-weight.
Despite full order books, Plug Power's stock is in an extended consolidation. The popular H2 share was still above EUR 30 in September and is currently trading below EUR 14. Research experts have predominantly rated Plug Power as a "buy" for months, but the 2024 price/sales valuation is still ambitious at a factor of 4. Technically, support at approx. EUR 11.50 can be identified after the sell-off. However, the sell-off should not go that far in this rushing environment. Nel ASA and Plug Power should be kept on the watchlist. Both are strong momentum stocks that can follow the established trend for a long time.
The hydrogen sector is being thrust into the spotlight by politicians. If government money flows as announced, many projects that until yesterday seemed unfeasible are suddenly viable. Private investors are also jumping on board. With the shares mentioned above, investors are at the forefront.
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