TUI, Lufthansa, Silver Viper - The doubling opportunities for 2022!

TUI - Not out of the woods by a long shot

TUI's coffers are empty again, as last year's emergency bond to bridge the Corona Crisis has been topped up once again. In addition to the Delta variant and Angela Merkel's plans to "lock out" English tourists, who are important for TUI, this is now again a burdening factor for the share. As a result, the nominal volume of EUR 400 million will be extended by new convertible bonds with a nominal amount of EUR 190 million. With the conversion right, TUI hopes to convert the now repayable parts of the financing into equity.

The conditions remain the same: the convertible bond with a 4.5% coupon will run until April 16, 2028, and can be converted into new shares of the TUI Group at a premium of between 25 and 30%. The evening auction even saw a small oversubscription, meaning that TUI now has more than EUR 200 million in new funds at its disposal.

The travel group has been relying on more money coming into its coffers through bookings since mid-2020 after the business was down for long stretches - in parallel, TUI is raising additional funds from investors. In this way, the actual utilization of the multi-billion government loans is also limited to what is necessary. The repayment of the tranches used from these is to be initiated. The current outlook has not been able to convince investors and TUI fell back to EUR 4.25 yesterday. The EUR 4 mark should hold in the current environment.

Lufthansa - The travel wave rolls, the balance sheet stutters

Anyone concerned with TUI certainly also has the airlines in their sights. The first half of the year is now almost over - and the mood at the aviation giants is still frosty. It is not only the vacation sector that is burdened. After all, the loss of the many business trips is unlikely to be temporary. Zoom & Co. has shown that things can be done differently in the business sector. Although the desire for face-to-face meetings has grown significantly in the pandemic, obstacles with travel requirements and testing regulations still dominate. In many places, the formalities are completely unclear; if things go badly, you come from a mutant area and have to go into quarantine for 14 days. Today, no one can afford that professionally.

According to current analyst estimates, the MDAX-listed group is likely to post another loss in the billions in the current year. The experts expect the crane airline's revenue to climb from EUR 13.6 billion to EUR 17.3 billion in 2021. However, adjusted EBITDA is still likely to end up in the red by around EUR 150 million after a whopping minus of EUR 2.9 billion in 2020. Below the line, there is even the threat of a net loss of EUR 2.3 billion. Special write-offs are now joining the routes that have been eliminated. However, in the exceptional Corona year 2020, the net loss of EUR 6.7 billion was much higher and indeed close to the absolute limit.

It is currently open to speculation how Lufthansa and other airlines will deal with the "new normal" in the travel environment. Ultimately, the abstinent passenger will have to be brought to the flight counter by creative means. No successes will be achieved with a frenzy of regulations and further restrictions, e.g. on hand luggage and free baggage allowances or similar.

All in all, the market environment remains challenging and the airline charts are under pressure. The book value of the LHA share will soon be asked about again - but this is, of course, only on paper due to continuing losses. Wait and see - and buy below EUR 8.50!

Silver Viper - The first resource can now be determined

Far away from any travel restrictions, the Canadian Silver Viper continues with resource determination in La Virginia. The current situation around the pandemic would only play a role if the work in the project would have to be interrupted again, but this is currently not the case. A technical report in accordance with the NI 43-101 standard has just been submitted. The report was prepared for Silver Viper Minerals Corp. by Arseneau Consulting Services Inc. and can be viewed under the Company's issuer profile.

La Virginia is located in Mexico 220 kilometers east-northeast of Hermosillo and hosts prospective epithermal style precious metal mineralization. The gold and silver mineralization occurs within breccias, veins and stockworks hosted primarily by andesitic volcanic rocks. Silver Viper's reconnaissance program identified key targets and trends that can now be further explored. The total project area covers 6,882 hectares, and 100 drill holes totaling 27,021 meters have been completed on the property.
Silver Viper is also in possession of all current and historical diamond drill core and sample packages recovered from the property since 2010. It has been possible to confirm the accuracy of the historical data through diamond drilling in ten core holes at Las Huatas, Con Virginia and the northern extension of the El Oriental target areas.

Silver Viper stock is doing very well despite constant attacks on gold and silver prices. It has established itself in the CAD 0.50 to CAD 0.65 valuation band, representing a market value of CAD 45 million. In our opinion, the good news from Mexico should continue for some time.