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December 7th, 2023 | 08:40 CET

TUI strong! BYD reacts to share price slide! First Hydrogen share price about to jump?

  • Hydrogen
  • fuelcell
  • Tourism
  • Electromobility
Photo credits: BYD Company Limited

TUI shares reacted to strong figures yesterday with a jump of over 10%. The tourism group also announced its intention to leave London and relocate its headquarters to Germany. However, the initial reactions from analysts were somewhat cautious. Given BYD's disappointing performance throughout the year, price reductions and negative analyst opinions have led to another sell-off. Now, the Company has decided to buy back its own shares, but will that be enough for an upward trend? First Hydrogen has several pieces of promising news. The Canadians have introduced their hydrogen fuel cell commercial vehicles in the UK, and interest is high. Furthermore, they plan to enter battery production with a partner. Will the three shares take off further, driven by the positive news?

time to read: 4 minutes | Author: Fabian Lorenz
ISIN: TUI AG NA O.N. | DE000TUAG505 , BYD CO. LTD H YC 1 | CNE100000296 , First Hydrogen Corp. | CA32057N1042

Table of contents:

    First Hydrogen: Will orders cause the share price to soar?

    Can First Hydrogen shares be among the high-flyers in 2024? The chances are not bad. Like many hydrogen stocks, the current year has been challenging for the Canadian company. The share price fell from EUR 3 to EUR 1. But this is precisely the opportunity because First Hydrogen has reached significant milestones in the development and testing of hydrogen fuel cell commercial vehicles and is now ready for the market.

    At the end of October, First Hydrogen demonstrated the performance of its hydrogen fuel cell commercial vehicles with a top range of over 630 km at a track day in the UK. The event attracted a great deal of interest. 21 fleet operators and industry specialists from Europe and the UK were in attendance. Interested parties included grocery group Sainsbury, parcel delivery company DPD, mining conglomerate Anglo American and leasing specialist ARVAL (BNP Paribas Group). According to First Hydrogen, all participants combined have over half a million vehicles. And they are all looking for emission-free alternatives for the future. First Hydrogen is ready for the market at exactly the right moment. Research Nester estimates that the global market for hydrogen vehicles will grow by around 45% annually between 2023 and 2035 and that the volume will multiply from USD 1 billion to USD 45 billion.

    Following the successful development of the vehicle, First Hydrogen is now taking the next step: together with battery specialist EV Technologies, the Company intends to develop a compact, high-performance battery. It is to be designed specifically for hydrogen-powered fuel cell vehicles. First Hydrogen CEO Balraj Mann explains the move: "As we work towards developing our hydrogen production facility and vehicle plant in Shawinigan, it is important to build a strong supply chain with regional and local partners. The partnership with EVT, a Quebec-based supplier, is an important building block for our development and growth."

    If concrete orders for the hydrogen fuel cell commercial vehicles are now also reported, the shares, which are valued at less than CAD 100 million, should be able to take off.

    TUI: Analysts not convinced by figures

    TUI shares set off a fireworks display yesterday, rising by more than 10% in a northerly direction. This was due to strong preliminary figures. In the past fiscal year 2022/23, TUI increased its turnover by EUR 4.12 billion to EUR 20.67 billion. The tourism group more than doubled its underlying EBIT from EUR 409 million to EUR 977 million. The Company is also making progress in reducing its debt. Net debt (in accordance with IFRS 16) fell from EUR -3.43 billion to EUR -2.1 billion.

    The outlook is also positive. Although the 2024 summer program would still be in a very early phase of the booking cycle, the first signs point to a strong season. Bookings are currently 13% higher than in summer 2023, and prices are around 4% higher. In Germany, bookings are already 25% up on the previous year.

    TUI also surprised with another announcement. The travel group intends to relocate its headquarters from England to Germany. This would involve a delisting from the London Stock Exchange and a listing on the Prime Standard of the Frankfurt Stock Exchange. This would make TUI a candidate for the MDAX.

    Initial reactions from analysts to the news were somewhat reserved. UBS, Jefferies and Bernstein merely confirmed their "Neutral" recommendations. Developments in the Middle East (UBS) and the generally more challenging economic environment (Jefferies) are causing concern. The price targets were not raised. UBS has a target price of GBP 6.44, Jefferies of EUR 6.10 and Bernstein considers EUR 6.80 to be appropriate. Yesterday, the TUI share traded above EUR 6.60.

    BYD reacts to share price slide

    For a long time, BYD managed to escape the price war instigated by Tesla. Is that now coming to an end? Indications point in that direction, especially with price reductions for some models in China. This was also one reason the analysts at UOB Kay Hian withdrew their "Buy" recommendation and reduced the price target from HKD 630 to HKD 140. The reaction was a sell-off of the stock to around EUR 24 within a few days. As a result, BYD shares are trading at the same level as at the start of the year. The Chinese company has risen to become the leading e-car manufacturer in 2023.

    Apparently, the Company considers its own shares to be undervalued. Yesterday, the Executive Board announced a share buyback program. Within the next 12 months, the Company intends to buy back its own shares worth around USD 28 million. The stock market reacted with a share price increase of over 3%. However, it should be noted that BYD's market capitalization is around USD 80 billion. The buyback volume is, therefore, anything but high and is likely to have little impact on the share price.

    The coming year promises to be exciting for all three companies. If First Hydrogen can report the first orders for its hydrogen fuel cell commercial vehicles, the share has the potential to be one of the top performers in 2024. TUI has set a positive signal with its figures for 2022/23. A countermovement at BYD was not surprising after the sell-off. The share buyback is expected to support the share price. The key factors will be sales in China and the entry into the European market.

    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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