February 17th, 2025 | 07:30 CET
TUI stock weak after numbers – Nova Pacific Metals and Super Micro Computer fare much better
The latest quarterly figures from TUI disappointed investors. Despite optimistic booking forecasts, the share price corrected by up to 17% within two days after the expected revenue targets were missed. This raises questions about the sustainability of the travel Company's comeback, which most recently wanted to appeal to new customer groups with low-cost offers. Nova Pacific Metals and Super Micro Computer present a very different picture. Nova Pacific's share price rose by over 80% within three days. Super Micro is raising hopes of a turnaround despite delisting risks due to a new auditor and attractive AI prospects – supported by a low P/E ratio of 10. We take a closer look at the three companies.
time to read: 5 minutes
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Author:
Armin Schulz
ISIN:
TUI AG NA O.N. | DE000TUAG505 , NOVA PACIFIC METALS CORP | CA66979J1066 , SUPER MICRO COMPUT.DL-_01 | US86800U1043
Table of contents:
"[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
Author
Armin Schulz
Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.
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TUI - Growth amid market skepticism
TUI AG's results for the first quarter of fiscal 2025 underscore the robust recovery with revenue growth of 13% to EUR 4.9 billion. The travel giant's Holiday Experiences segment drove profitability, as Hotels & Resorts posted a 66% increase in EBIT, while Cruises and TUI Musement achieved double-digit growth. Bookings remained robust, with 3.7 million customers traveling with TUI, 6% more than in the previous year, due in particular to the 18% increase in dynamic package sales. Management reaffirmed its forecast for the 2025 fiscal year, which anticipates EBIT growth of 7-10%, despite competitors expanding their capacities.
CEO Sebastian Ebel wants to expand into Southeast Asia and Latin America to reduce dependence on European markets. Strategic partnerships, such as the integration of Ryanair into TUI's dynamic packages, have already led to a 45% increase in app sales in the UK. The Company is also expanding its hotel facilities, including new resorts in Vietnam and Indonesia, to improve its margins. An upgrade of the BB rating by Fitch confirms the progress made on the balance sheet: net debt has stabilized at EUR 4.1 billion. With these steps, TUI is in a position to benefit from the structural demand for travel.
With a P/E of 7 - half the historical average - the stock appears undervalued compared to other companies. Analysts indicate price targets of EUR 14-16, leaving plenty of upside potential. Further EBIT growth and debt reduction could bring the stock back into the focus of investors. However, risks remain: weak bookings in Germany, cost inflation, and saturation in the UK market require rapid realignment implementation. This requires money; accordingly, the dividend payout will be paused until at least 2027. The stock has been under pressure since the results were announced and is currently trading at EUR 7.104.
Nova Pacific Metals – Strategic positioning with critical metals
Nova Pacific Metals, a Canadian explorer focused on its Lara polymetallic volcanogenic massive sulfide (VMS) deposit, provides the raw materials for the energy transition. The property covers approximately 1,848 hectares and has 323 historical drill holes. As a result, the property is known to host copper, zinc, lead, gold, and silver – metals that are increasingly in demand as a result of global electrification and green technologies. The location in British Columbia, a mining-friendly region with established infrastructure, underscores the potential for expansion and near-term production. Based on a new analysis of historical data from the 1980s, the Company recently announced that it will expand its planned drilling campaign from 19 to 49 drill holes to re-evaluate the potential of the Coronation zone.
Reviewing historical exploration data, which involved digitizing 226 drill holes into an updated database, has given management a comprehensive overview of the property's potential and a basis for future resource estimates. Based on this data, more precise targets were developed for the planned 10,000 m drilling campaign. The Coronation Zone, explored in the 1980s, shows enrichments of up to 3.01% zinc and 32.97 g/t silver. Nova Pacific Metals aims to confirm existing resource estimates and identify new mineralization in under-explored areas. CEO Malcolm Bell said: "With the expanded drilling program at the Lara Project, we could optimize the existing estimate of historical resources and demonstrate further potential in this VMS system."
He is supported by an experienced team, including newly appointed consultants such as VMS expert Dr. Tom Setterfield, Scott Young, and Craig Williams. The drill program has a budget of CAD 2.6 million and is already fully funded. Results from a backpack drilling program in December 2024 were already promising. 12.5 g/t gold, 409.3 g/t silver, and 37.92% zinc in a 2.2 m long interval were found. The demand for base and precious metals is driving up the project's valuation. Copper is trading at 4.66 USD/pound, gold at over 2,893 USD/ounce. The stock, which was briefly trading at CAD 0.19 at the beginning of February, rose sharply and is currently trading at CAD 0.33.
Super Micro Computer – Between growth and challenges
Super Micro Computer recently published its figures for the second quarter of fiscal year 2025. Revenue rose by 54% to between USD 5.6 and USD 5.7 billion. This is primarily due to the high demand for Artificial Intelligence infrastructure as a Service. Nevertheless, the annual forecast was lowered from the original USD 30 billion to USD 23.5 to 25 billion due to delays in the introduction of new technologies and uncertainties in customer planning. Adjusted earnings are between USD 0.58 and 0.60 per share. The main problems for the Company remain margin pressure and the delay in submitting financial reports.
The Company's hopes for the future lie with direct liquid cooling, which is expected to gain importance in data centers in the coming years. Around 30% of all new data centers will be able to adopt this technology in the coming months. The delivery of NVIDIA-Blackwell products should also boost business. To meet growing demand in the long term, Super Micro Computer is expanding its production facilities in the US, Taiwan, and Europe.
Despite the positive outlook, risks remain. The AI boom is expected to generate USD 40 billion in revenue by 2026. Analysts doubt the Company's ability to achieve its ambitious revenue targets, citing supply chain bottlenecks and increasing competition in the AI server market. Super Micro Computer is at an inflection point. Demand for AI solutions offers tremendous growth opportunities, while technological innovations such as liquid cooling keep the Company competitive. The stock has risen around 85% since the beginning of February and is currently trading at USD 47.88.
The latest developments show a mixed picture: TUI missed expectations despite revenue growth and was punished by investors. Nova Pacific Metals, on the other hand, benefited from rising demand for metals for the energy transition and higher commodity prices. In addition, the new drilling program promises potential. Super Micro Computer was unable to fully convince despite a 54% increase in revenue due to lower forecasts and margin pressure, although AI demand offers further growth potential. Nevertheless, the share price has risen by as much as 85% since February.
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