MiMedia is likely to face a revaluation. The AI cloud player has held up surprisingly well during the recent sell-off, even completing a capital increase beforehand, and is now starting operations with the giant Walmart in Latin America. Revenues are expected to increase massively this year – will the stock follow suit? Deutz has also held up well in these turbulent times. Following the takeover in the electric sector, the Company confidently announced price increases despite the tariff chaos. In Germany, the engine manufacturer could benefit from the new federal government's plans. Infineon's stock has taken a beating. Will a takeover in the US turn things around? Analysts believe that the semiconductor group is one of the structural winners in Europe. Should you buy the stock?
time to read: 4 minutes
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Author:
Fabian Lorenz
ISIN:
DEUTZ AG O.N. | DE0006305006 , INFINEON TECH.AG NA O.N. | DE0006231004 , MIMEDIA HOLDINGS INC | CA60250B1067
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Author
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.
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MiMedia poised for revaluation
While other small-cap stocks have taken a beating in the sell-off of the tariff conflict in recent days, MiMedia has held up well. This is a good sign for the rest of the year, in which the AI cloud player is still getting off to an operational start. The Company operates an innovative cloud platform for media content based on artificial intelligence – and after the recent cooperation with the Walmart Group, sales should increase significantly in the current year, causing the share price to be revalued.
MiMedia has gained Walmart Latin America as a strategic partner. This subsidiary of the US retail giant is one of the leading retail companies in Latin America, with annual sales of over USD 48 billion. In Mexico and Central America, Walmart operates more than 4,000 stores and is a major player in the regional telecommunications market with its "Bait" brand. In just five years, Bait rose to become the third-largest provider in Mexico, counting 18.3 million customers at the end of 2024 – and counting, on its way to becoming number 2.
This means huge growth potential for MiMedia. The partnership envisages that the MiMedia app will be pre-installed on all new smartphones sold by Bait in Mexico. In addition, the app will be installed via an Over-The-Air (OTA) update on Android devices already in use by Bait customers, currently over 18 million. Furthermore, an extensive advertising campaign is planned, both online and directly in stores, to promote the Bait cloud platform throughout Latin America. MiMedia will be integrated as an integral part of this platform. Walmart already operates very popular applications in the region, such as "Cashi" (for digital payments) and "Salud" (for health topics). The integration of MiMedia content is expected to further increase user loyalty and revenues.
The cooperation with Walmart Latin America provides MiMedia with a stable, rapidly growing pipeline of devices on which the platform is pre-installed as a media gallery. This should generate high-margin, recurring revenue. The US business should also contribute to revenue and earnings in the current year, where the sale of smartphones with the pre-installed MiMedia app has already begun. The existing device contracts alone represent potential gross revenues of over USD 125 million. MiMedia's current market capitalization is only in the low double-digit million range (CAD). This is not likely to remain the case for long.
Deutz: Profiteer of the new German government?
Unlike MiMedia, Deutz is certainly not a bargain in terms of its valuation. However, the chances are good that the Cologne-based company will grow into its valuation. As a result, the stock has held up well in recent days. One indication that Deutz engines are in high demand in the US and are difficult to replace is that Deutz has already confidently announced that it will pass on tariffs to customers through price increases.
In addition, Deutz could benefit from the plans of the new black-red German government. The coalition has announced its intention not only to scrap the Heating Act but also to revise the ban on combustion engines, aiming to shift climate protection efforts more toward CO₂ pricing. The goal is to be open to technology. However, this must also happen at the EU level.
Infineon: Structural winner in Europe
While MiMedia and Deutz have held up relatively well in the sell-off, Infineon's stock has taken a real beating this year. While the German semiconductor manufacturer's stock was still trading above EUR 38 in mid-February, it was down to just under EUR 25 the day before yesterday. At least the stock managed to gain around 9% in yesterday's recovery rally.
Jefferies analysts recently recommended the Infineon share as a "Buy". The analysts consider the semiconductor manufacturer to be one of the structural winners in Europe. The experts see the fair value of the stock at EUR 42.
The announced takeover has caused a stir. In order to strengthen its leading position in microcontrollers for automotive applications and to increase its system expertise for software-defined vehicles, the Company plans to acquire the automotive Ethernet business of the US group Marvell. Infineon and Marvell Technology have agreed on a purchase price of USD 2.5 billion. Ethernet is a key technology for communication and connectivity solutions with low latency and high bandwidth, which is crucial for software-defined vehicles. In addition, it holds great potential for adjacent application areas such as humanoid robots. The planned investment is intended to further strengthen Infineon's already firm foothold in the US, including extensive research and development activities.
The relative strength of the MiMedia share in the sell-off of the past few days is a clearly positive sign. The technology company's revenue is expected to increase massively in the current year. Against this backdrop, the valuation appears attractive, and a revaluation of the share is only a matter of time. In contrast, Deutz's stock has already priced in much of the good news. However, the Cologne-based company has strong potential to grow into its valuation. At Infineon, the strong focus on the automotive sector is causing some concern.
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